(Saint Paul Pioneer Press (MN) Via Acquire Media NewsEdge) Nov. 28--Unhappy shareholders of Aetrium Inc. have failed to wrest control of the struggling semiconductor industry supplier from its board, but a spokesman for the dissidents says they aren't giving up.
The dissidents, who calls themselves Concerned Aetrium Shareholders, or CAS, said Tuesday, Nov. 27, that the board misinterpreted its bylaws and changed its rules to thwart the effort to vote out the directors on Monday.
The board responded that it is trying to avoid having the company stuck in limbo while the dissidents figure out what they want to do, a spokesman said.
The 30-year-old company, which makes circuit-testing equipment for the semiconductor industry, has watched sales drop and losses pile up of late.
Aetrium, based in North St. Paul, lost $4.7 million in 2011 after revenue dropped to $9 million from $16.3 million in 2010.
The losses got worse this year. Aetrium reported a loss of $5.2 million for the first nine months of 2012, up from last year's loss of $4.1 million for the same period.
Shares of Aetrium closed Tuesday unchanged at 65 cents.
With about 45 percent of the outstanding shares available to vote at Aetrium headquarters, the CAS group estimated it had an 8-to-1 majority favoring a board takeover, CAS leader and spokesman Jeff Eberwein, a former Soros Fund manager, said.
But the board did not hold a vote because the meeting did not have a quorum, which required a majority of the outstanding shares, Aetrium chief administrative
officer Doug Hemer said.
CAS disputed that a majority of outstanding shares was required for a quorum, but it was blocked when it wanted to adjourn until Dec. 10 so it could try again.
The board on Nov. 20 had changed its bylaws to give Chairman and CEO Joseph Levesque sole power to adjourn a meeting when there is no quorum. Previously, shareholders were allowed a vote.
"The incumbent directors have once again shown that they are entrenched -- their main goal is to hold onto their positions no matter the cost rather than follow the will of the shareholders," Eberwein said in a statement.
"We are studying next steps and are not going away," he added in an email.
The board could not allow the meeting to adjourn until Dec. 10 because CAS did not include that option when it filed its proxy with the U.S. Securities and Exchange Commission, Hemer said.
The board opposes the CAS-proposed board because its members have no experience in the semiconductor supplier industry and no ready plan for the company, Hemer said.
Leslie Brooks Suzukamo can be reached at 651-228-5475. Follow him at twitter.com/suzukamo.
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