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One-time e-security giant Baltimore Technologies has called an attempt by its biggest shareholder to take control of the board of directors "opportunistic".

The Irish technology company, which is now a cash shell after months of asset selling, has hit back at Acquisitor Holdings after the investment company proposed that Baltimore's entire board of directors be replaced. Aquisitor had blasted the current Baltimore board, saying it was responsible for the company's "disastrous" financial performance, and it is nominating two alternative candidates for the jobs of Baltimore chairman and CEO.

Bermuda-based Acquisitor, which owns about 10.1 per cent of Baltimore, has called for an Extraordinary General Meeting to be held, at which the group will put forward David Buchler and Duncan Soukup for the jobs of Baltimore chairman and CEO respectively. Buchler is the founder of Buchler Phillips and most recently he held the job of chairman of Kroll Europe. Soukup, meanwhile, is the deputy chairman of Acquisitor Holdings.

"This move is opportunistic in seeking to secure control of the company and its assets, without paying a premium to shareholders by making a formal offer for the company," Baltimore said in a firmly-worded response. "The timing of this notice is disruptive to the process already well underway which will see it present proposals for Baltimore's future to shareholders at the time of the company's financial results announcement on 31 March 2004."

Indeed, Baltimore, led by Executive Chairman Bijan Khezri, has undergone a painful sell-off process over the last year that culminated in the sale of its main PKI business in late 2003. The firm now consists of little more than cash, property and a handful of small services units.

On 31 March, when the firm's full year results are released, the former e-security company will announce what it plans to do next. Its choices consist of liquidation and a return of cash to shareholders, the acquisition of another firm, or a combination of the two. Though the company said that this announcement would still go ahead, the company will be forced to call an EGM in the next 21 days.

"Baltimore Technologies was once a FTSE 100 constituent with a market capitalisation of more than £5bn but today is a cash shell with a recent market value of some £20m, having lost 97 per cent of its value," Acquisitor said in its argument for a new board, adding that it is worried that the current board will squander any remaining shareholder value.

"As Baltimore Technologies' largest shareholder we have reviewed the past performance of Baltimore Technologies and are of the opinion that the current board are in large part responsible for the oversight of more than £1bn in trading losses," Soukup said in a statement. "Their involvement and association in the company's past disastrous dealings leave us with no choice but to requisition an EGM to clear the air and give Baltimore Technologies shareholders the confidence that their interests are being served properly."

© ENN

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