NU Online News Service, Jan. 21, 11:16 a.m. – Cobalt Corp., Milwaukee, says it wants to nominate its own slate of directors in the upcoming proxy for American Medical Security Group Inc.
Cobalt needs more seats on the American Medical board so that it can make the Green Bay, Wis., insurer buy back stock and take other efforts to increase the value of its stock, Cobalt says in a report filed with the U.S. Securities and Exchange Commission.
American Medical has more capital than it needs to finance its current level of growth, and it ought to use some of that capital to buy back shares held by Cobalt and other investors, Cobalt argues.
American Medical responded by pointing out that Cobalt already has three seats on the American Medical board.
Cobalt would probably get better results if it held a secondary public offering for its American Medical shares, rather than trying to make American Medical buy back stock, American Medical contends.
American Medical says it is seeking SEC permission to keep the Cobalt board nominees out of its spring proxy statement.
Figures from Commodity Systems Inc., Boca Raton, Fla., suggest American Medical shares have been doing better than Cobalt shares over the past year.
