Green Point Parent Sees Shares Surge In Contested IPO
NEW YORK -- Shares of Green Point Savings Bank's parent jumped 27% in an initial public offering after a federal appeals court cleared the way for its conversion from mutual to stock ownership.</br></br>Shares of the New York thrift's parent, GP Financial Corp., surged to $19 from the conversion price of $15 in Nasdaq Stock Market trading Friday. Trading volume was a robust 19.1 million shares. The stock trades under the symbol GNPT.</br></br>A federal judge in New York had granted a temporary restraining order requested by certain depositors who opposed the conversion, but Green Point appealed that decision in the U.S. Court of Appeals for the Second Circuit, which overturned the order.</br></br>Melvyn I. Weiss, an attorney who represents depositors in the class-action suit against Green Point, said he was "disappointed" with the court's decision. He said he plans to seek monetary damages of about $200 million for the class of plaintiffs.</br></br>Critics have argued that many depositors typically don't buy shares in stock-conversion deals, while management and trustees get large stock options and reap big gains on their purchases when share prices rise. In Green Point's case, for instance, only about 11,000 of about 250,000 depositors participated in the conversion. Following such concerns, the federal government recently proposed guidelines seeking to prevent insiders from making excessive profits in such conversions.