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Shamrock Holdings claims victory in Texas Industries board vote

The Disney family investment firm says a preliminary tally shows it won an effort to replace three directors at the cement maker.

October 23, 2009|W.J. Hennigan

Shamrock Holdings, the Disney family investment firm, won three seats on the board of directors of one of the nation's biggest cement makers Thursday, according to Shamrock's preliminary tally.

Although the official results won't be released until next week, Shamrock executives said the early returns showed that their company won the seats on Texas Industries Inc.'s nine-member board by a 4-1 ratio. The vote took place at Texas Industries' annual shareholders meeting Thursday in Dallas.

The Burbank-based investment firm, known for shareholder activism, started snapping up Texas Industries' shares in September 2008, when the housing market was a shambles and the cement maker's stock began to plummet.

Stanley P. Gold, Shamrock's president and chief executive, said his firm began agitating for change because it was displeased with the way Texas Industries Chairman Robert Rogers was running the cement maker.

"This is the largest repudiation of a company's leadership that I've seen," Gold said. "It's a wake-up call to Texas Industries and Mr. Rogers that they better get their act together."

The Dallas-based cement producer is the largest in Texas and has a major presence in California with two major plants in Oro Grande, near Victorville, and Riverside. Texas Industries shares peaked at about $90 two years ago but have fallen by more than half since then.

Shamrock, the third-largest Texas Industries shareholder with a 10.2% stake, believes construction will bounce back and demand for cement will rise in the coming year as the U.S. emerges from recession.

"Now, I want the new board members to work to make me money -- me and every other shareholder," Gold said. "After all, that's why we're in this business."

A Texas Industries spokesman said the company would not comment until the official tally was released. But the company issued a news release before the vote Thursday. The statement acknowledged that the cement industry faced challenges but said Texas Industries could overcome them.

"We have been navigating uncharted waters for some time now, and I applaud our employees' positive and effective response to these unprecedented challenges," said Mel Brekhus, Texas Industries' chief executive. "The current environment is expected to continue for the building materials industry in the short term, but . . . TXI is well-suited to successfully meet these challenges."

Shamrock was started by Roy E. Disney as an investment vehicle for the Disney family. Over the years, it has evolved into a multi-pronged investment company that includes five private equity funds with $2 billion in assets. The Disney family has about $200 million invested in Shamrock.

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william.hennigan @latimes.com

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