Argosy management stoush to hit the courts

Argosy management stoush to hit the courts

By Paul McBeth

July 14 (BusinessDesk) – The stoush over how Argosy Property Trust’s management will be brought in-house is set to go to court

Rival DNZ Property Fund Ltd. said it has filed papers in the High Court in Auckland after Argosy’s manager failed to call a special meeting of unitholders.

DNZ joined fellow Argosy investors the Accident Compensation Corp., New Zealand Superannuation Fund and Westpac Banking Corp. who banded together to force a meeting where they planned to dump the OnePath NZ Ltd.-owned manager.

“Our earlier request for a special meeting to vote on resolutions that would require Argosy to have an independent review of all options, with the information then presented to unitholders, has so face been ignored,” DNZ chairman Tim Storey said in a statement.

“Our concern, shared by other significant unitholders in Argosy, is that none of this information is being presented to all unitholders and there is little transparency in the current process of internalisation.”

Australia & New Zealand Banking Group-owned OnePath offered to sell its management contract with Argosy for $32.5 million, so the property investor could bring managers in-house.

OnePath’s offer sparked ire among investors, and Argosy’s independent directors eventually backed away from recommending unitholders accept.

Management contracts have come under scrutiny in recent years with managers rewarded on the value of gross assets. Argosy pays its manager an annual fee of 0.6% of gross assets.

DNZ started sniffing around Argosy in May, saying a merged entity would have greater size and scale, lower debt and reduced costs.

Shares in DNZ were unchanged at $1.30 in trading today, while Argosy units fell 1.2% to 82 cents.

(BusinessDesk)

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