An activist shareholder trying to get control of tiny Aetrium Inc. of North St. Paul pledged Friday to "keep going" after a Ramsey County judge rejected installing New York investor Jeffrey Eberwein's slate of directors following a disputed shareholder vote earlier this month.
Ramsey County District Judge John Guthmann, in ruling for Aetrium earlier this week, essentially invited the parties to hold another vote.
Eberwein wants a new vote and shareholders meeting as soon as possible. But Aetrium, which prefers to wait until the annual shareholders meeting in May, doesn't have to schedule a vote and special meeting under Minnesota law until the third week in March.
Eberwein, a New York investor who worked for a big hedge fund until he struck out on his own by going after several companies, has organized a dissident shareholder group in Aetrium since September. He alleges that he had a majority of shareholders backing him in early December until Aetrium's board thwarted the process by manipulating its bylaws and declaring that no quorum existed.
Doug Hemer, Aetrium's general counsel and a director, said the company probably will not announce its next move until January. Aetrium maintains that the dissidents have lied to shareholders.
Directors dismiss dissidents
Hemer, who noted that directors and officers own less than 5 percent of the company, said, "We hold our obligation as directors very dear and that we couldn't turn over control of the company to these guys who have no plan, no experience, and satisfy our obligation to shareholders."
Aetrium makes "gravity-feed" testing equipment for the semiconductor industry. That industry has been flat-to-down since the recession, and Aetrium, whose stock has fallen from $6 per share to under 50 cents since 2008, also lost huge Texas Instruments as a customer several years ago.
Aetrium's management, which has had fruitless talks with Eberwein and his associates, said it has a plan to revive the money-losing company in an improving economy and that the proxy fight is counterproductive. They said, however, that they would respect a full vote of shareholders that will take place sometime next year.
"The Eberwein group said we were trampling on shareholders' rights, but they didn't have enough votes," Hemer said. "They lost."
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