Abigail Adams National Bancorp Inc. (NDAQ: AANB) received a $3.45 per share all cash takeover offer from an activist shareholder on January 29th, but investors don’t seem to be taking notice. PS D’Iberville Limited Partnership made the offer after the company agreed to and then subsequently rejected its request to review the firm’s books to conduct due diligence.

Here’s a copy of the letter:

Your letter dated January 28, 2008 (2009 is the correct date) is unacceptable.  Your letter, dated January 23 2009, specifically stated that P.S. D’IBERVILLE LIMITED PARTNERSHIP could inspect the items requested in our letter of September 26, 2008.  You confirmed, by telephone, that you would allow P.S. D’IBERVILLE LIMITED PARTNERSHIP to inspect the items requested and would not cancel the appointment.  P.S. D’IBERVILLE LIMITED PARTNERSHIP demands that you allow us to inspect all the items.  Given your unwillingness to allow us to review all of the books as previously indicated and your rejection of our past offers to assist, we are proposing instead that P.S. D’IBERVILLE LIMITED PARTNERSHIP pursue an acquisition of all the shares of Abigail Adams National Bancorp, Inc (AANB).  We propose a price of $3.45 all cash per share.  We have existing cash resources available to fund this transaction and are prepared to move as quickly as necessary.

We believe time is of the essence.  You have already wasted valuable time to increase shareholder value since our letter of August 19, 2008.  Your customers, regulators and employees will appreciate immediate action.  This non-binding proposal is subject to the negotiation of mutually satisfactory definitive agreements, regulatory approval, and the completion of customary due diligence, all of which could be progressed and finalized without delay.

We have already made our plane reservations to visit with you on Monday, Feb. 2, 2009.  Failure to confirm by Friday, January 30, 2009, at 4:00 pm that all the records requested in our September 26, 2008 letter will be available for our inspection will be construed to be a breach of your fiduciary duty and obligations pursuant to statute and we will not show up Monday, February 2, 2009.  If you choose not to let us review all of the materials on February 2, 2009, please let us know when we can complete our due diligence inspection.

It is important to remember that non-binding takeover offers are not guarantees, particularly when management doesn’t appear to be interested in selling the company. As a result, shares continue to trade at $2.15 per share despite the presence of a $3.45 per share offer. However, this could represent an opportunity for other activist investors are arbitreurs.

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Amylin Pharmaceuticals (NDAQ: AMLN) shares are trading well off of their 52-week highs after two amid complaints from two activist investors. Billionaire activist Carl Icahn recently nominated his own slate of directors while Eastbourne Capital Management, which owns approximately 12.5% of the company’s shares, followed suit and nominated its own slate to compliment that of Icahn, according to a Schedule 13D/A filing with the SEC.

“We have been a long-term shareholder in Amylin based on our belief that the company has unmatched potential, but we believe this potential has been squandered and has resulted in significant shareholder loss,” said Eastbourne’s Rick Barry. “It is clear that we are not alone in our belief that significant change at the board level is required to ensure that the proper steps are taken to maximize the commercial value of Amylin’s assets.”

The hedge fund noted that Amylin has lost nearly 80% of its market value since its all-time high price on October 5, 2007. Despite this decline and history of disappointing results, however, the fund continues to invest in Amylin because the company’s products could deliver significant shareholder value if managed properly. So, while they have not lost faith in the potential of Amylin’s products and pipeline, they have lost confidence in Amylin’s leadership to execute an operational strategy in the best interest of shareholders.

Clearly, this is a situation worth watching when to large activist investors, including Carl Icahn, get involved to unlock value.

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R.G. Barry Corporation (NDAQ: DFZ) may have reported very strong earnings in the second quarter, but some investors are clamoring for change. Mill Road Capital, which owns 529k shares, believes that the firm is undervalued and offered to acquire the stock for $7 to $7.25 per share in cash, according to a Schedule 13D filing with the SEC.

Here's a copy of the letter:

Mill Road Capital L.P. (“Mill Road”) has been following R.G. Barry Corporation (“R.G. Barry” or the “Company”) for quite some time. We are highly impressed with the Company, its management team, and its Board of Directors. We currently own approximately 529,000 shares of the Company’s stock and are one of the largest shareholders of the Company.

Despite the Company’s many strengths, we think that the public market does not accord a high valuation to R.G. Barry because it is a small company in a very low growth market. Over the last several years we have seen few investment funds interested in investing in the Company. In fact, we believe the trading volume and market capitalization of R.G. Barry stock is so small that it will continue to preclude significant institutional interest in the Company. We are confident that if R.G. Barry were a private company today, it would be considered too small to “go public” at all. We further believe that by remaining public, R.G. Barry will be subject to continuous pressure to maximize short-term results at the expense of long-term return on invested capital, and will continue to incur regulatory costs and burdens disproportionate to the size of the Company. We think the terrific team at R.G. Barry will be better able to realize the Company’s full potential as a private entity.

Accordingly, Mill Road is pleased to submit this offer to acquire all the shares of the Company’s stock it does not currently own at a cash price of $7.00 to $7.75 per share. This represents a robust premium of 40% to 55% over the closing price of $4.99 as of January 27, 2009. Mill Road requires no outside financing to consummate a transaction and hence this offer contains no financing contingency. Due to our knowledge of the company, we believe the period required to complete our business, financial and legal due diligence should be brief and we are prepared to begin this period immediately.

Mill Road Capital is a Greenwich, Connecticut based investment firm focused exclusively on friendly investments in small publicly-traded companies. We manage capital for a prominent and highly respected group of limited partners including state pension funds, foundations, endowments and insurance companies. The investment professionals of Mill Road are largely former Blackstone Group professionals and we believe our experience enables us to complete transactions expeditiously.

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