FAB SHAREHOLDERS DEFEAT SALE PROPOSAL IN 72% VOTE
Byline: Daniela Gilbert
NEW YORK — At the annual shareholders meeting of Fab Industries, held Thursday at the firm’s Manhattan headquarters, a proposal to liquidate or sell the company was voted down by 71.7 percent of the voters. However, 26.6 percent voted in favor of it.
Proposed in March by Ralph A. Young of Harrison, N.Y., who holds 30,666 shares of Fab — representing about 0.6 percent of the more than 5.3 million Fab shares outstanding — the proposal suggested that the board “retain the services of an investment banking company, not previously retained by Fab, for the sole purpose of studying and recommending the best course of action between the choices of selling, liquidating or continuing the operations.”
Young was disappointed in the vote and said, “There’s not much of an argument of the facts. Sales are down, profits are down and we can’t compete anymore.
“I’ve expressed that I think it’s in the best interest of the stockholders to liquidate or sell the company. While guessing and hoping and optimism are all great, they’re simply unrealistic. I think we should just make an honest effort to find out how much we can sell or liquidate for. We’re here for the stockholders to make money,” Young continued.
Samson Bitensky, Fab’s chairman and chief executive, who holds 1.51 million shares or about 28.3 percent of Fab shares outstanding — said in response: “I’m a larger stockholder than you are, Mr. Young, and I started this company. I treat it as a business, not a game, and building a business takes time. I’ve had people working hard in this company for over 30 years and I realize in a business you have your ups and downs.
“I live this business every day, and liquidation to me would be death. I think of life, not death.”
While Bitensky told shareholders at the beginning of the meeting that 1999 was “the worst year we’ve ever had,” he remained optimistic that business will get better this year.
“There are some signs of improvement,” he said. “There was a small increase in the first-quarter results.”
For the fiscal year ended Nov. 27, Fab reported net income of $517,000, off 91.4 percent from $6 million the prior year.
Sales were $128.9 million, down 14.9 percent from $151.4 million.
Fab’s stock, traded in the American Stock Exchange, closed Monday at 10 1/2, up 3/16. It had a 52-week high of 16 5/16 and a low of 9 7/8.
Bitensky said he foresaw a profitable trend going forward and said, “The economy in the Far East has picked up, and NAFTA in Mexico has helped us a little.”
Also on the agenda at the meeting, which was attended by about 30 investors, Bitensky and Frank Greenberg were reelected to the company’s board.