25 Aug 2011

Shareholders Association backs Argosy deal

8:41 am on 25 August 2011

The Shareholders Association is backing Argosy Property Trust's $20 million plan to bring its property management in-house, even if concerted opposition by institutional investors results in a stalemate.

The association's support for Argosy's plan comes after the trust agreed to change its structure, from a unit trust to a company, which chairman John Hawkins says will give investors more control and protection, and add significant value.

Argosy's internalisation proposal has come under heavy fire from some institutional investors and rival DNZ Property Fund in recent times, and a variety of proposals will be put to unitholders at its annual meeting next week.

Mr Hawkins says the association will be voting any proxies it holds in favour of Argosy's deal, but he admits there's a chance of a stalemate.

Argosy's rival, DNZ, has put forward resolutions concerning a proposed merger, which will also be considered at next week's meeting.

And it's warned it'll drop the merger plans if Argosy brings its manager in-house.

Mr Hawkins says DNZ's offer lacks adequate detail to be credible at this stage and although there may be some merit in a merger of some of the property trusts going forward, that's something that can be investigated subsequently.