High Court throws out DNZ’s bid to force Argosy meeting

Article – BusinessDesk

July 29 (BusinessDesk) – The High Court in Auckland has thrown out a bid by property investor DNZ Property Fund Ltd. to force a special meeting for Argosy Property Trust unitholders to vote on dumping the ANZ Bank-owned manager.

High Court throws out DNZ’s bid to force Argosy meeting

By Paul McBeth

July 29 (BusinessDesk) – The High Court in Auckland has thrown out a bid by property investor DNZ Property Fund Ltd. to force a special meeting for Argosy Property Trust unitholders to vote on dumping the ANZ Bank-owned manager.

In the High Court in Auckland, Judge Raynor Asher today ruled against DNZ’s bid, saying the Argosy manager and its trustee, New Zealand Guardian Trust Co., made an “understandable decision in the circumstances” not to hold a special meeting, and that there wasn’t a breach of the trust deed or of statutory duty.

“DNZ will be able to put the existing proposed resolutions and any other resolutions it wishes to put at the annual general meeting,” Judge Asher said in his written judgement.

“It can if it wishes vigorously pursue its alternative proposal, but there is nothing to show that the independent directors and Guardian Trust are in all the circumstances acting in breach of their duties in refusing to respond to the requisition by calling a meeting immediately,” he said.

DNZ was hoping to force two special meetings for unitholders to dump the OnePath NZ Ltd. manager, and then to vote on DNZ internalisation proposal that would see the rival property entities merge. Along with the scheduled annual meeting, that would make three meetings in quick succession.

Judge Asher said that would be unnecessarily costly, and that it wouldn’t take that many meetings for DNZ to present an “informed proposal” to unitholders.

Last week, the trustee knocked back a bid by unitholders DNZ, Accident Compensation Corp., Guardians of New Zealand Superannuation and Westpac Banking Corp., to hold a special meeting to remove the manager.

The other activist unitholders didn’t join DNZ in its court action.

Last week, OnePath slashed its proposed fee to sell its contract and bring management in-house to $20 million from $32.5 million after Argosy’s independent directors refused to endorse the deal.

OnePath receives an annual fee of 0.6% of the trust’s gross assets under the deal, and internalising management follows a trend among listed property entities of axing the cost of external managers.

Unitholders will consider OnePath’s offer at the annual meeting next month.

Argosy’s units were unchanged at 84 cents in trading today, while DNZ shares were unmoved at $1.28.

(BusinessDesk)

Content Sourced from scoop.co.nz
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