An activist investor is pressing Franklin Financial Services Corp. to enter into a sale or merger "as promptly as possible."
In a letter dated June 12, Philip Timyan, a self-described professional bank stock investor, wrote that he plans to propose that Franklin Financial Services shareholders recommend to the board that the company "take the necessary steps" to reach a sale, merger or other agreement that would bring maximum shareholder returns.
"I no longer have confidence in either the board or management," Timyan wrote, adding that he owns more of the company's shares than any individual director. "I see no way for Franklin Financial Services Corp. to perform well enough on its own to warrant a stock price anywhere near $50."
Timyan targeted a handful of recent moves made by the company, including its role in an alleged fraud in a participation loan supposedly involving Manheim, Pa.-based Worley & Obetz Inc. In the letter, Timyan also wrote that he was "flabbergasted" by the board's decision to not list the company's shares on a Nasdaq Inc. listing venue, and that he believes that more due diligence could have prevented a recent $10 million settlement.
If the board does not begin soliciting bids for the company before October, Timyan wrote that he plans to submit a proposal for the company's 2019 annual shareholder meeting.
A spokesperson for Franklin Financial Services did not immediately respond to a request for comment.