Strategy effectively allows AGP board to do what it likes within broad range of “property”
Trans Tasman Properties Ltd has raised its interest in Australian Growth Properties Ltd to 65.84%, withdrawn its takeover condition requiring 75% acceptance of its A85c/share bid, and made a determined statement on future direction.
Trans Tasman issued a statement today concurring with AGP’s business investment strategy, which was approved by the AGP board on 23 September in a divided vote.
The 2 independent directors are to explain their votes in the target statement due out by tomorrow. Trans Tasman’s supplementary bidder’s statement was released today.
In the 23 September vote, Don Fletcher (Trans Tasman managing director & chairman, AGP director & also the representative of controlling shareholder SEA Holdings Ltd of Hong Kong in Australia & NZ), Trans Tasman executive director Rod Hodge and SEA managing director Jesse Lu voted for the strategy, AGP chairman Rod McGeoch and independent director & former Tasman Properties Ltd managing director David Cooper against.
The strategy adopted following sale of 80% of AGP’s portfolio was to:
Reinvest in Australian property investment & development markets as counter-cyclical & opportunistic investments arise
Invest further in what is broadly defined as real estate capital market opportunities, including property mortgage financing and
Investigate certain offshore property markets for possible investment where counter-cyclical property investment and/or development opportunities exist and/or where AGP has a commercial competitive advantage.In a supplementary bidder’s statement released to the Australian Stock Exchange today, Trans Tasman said it:
would vote against any proposal to wind AGP up, return its capital to shareholders or buy back its own shares
supports the strategy the AGP board adopted on 23 September
intends that AGP continue its business, and that business should be conducted in accordance with the strategy and
AGP’s assets should be invested in a manner consistent with the strategy.As for the future of the 2 independent directors who were voted down, Trans Tasman said: “If the independent directors resign, and Trans Tasman is not entitled to compulsory acquisition, Trans Tasman intends to replace those directors with other suitably qualified independent directors.”
Trans Tasman said if it didn’t get 90% of the AGP shares it might still carry on towards the level enabling compulsory acquisition.
GPG and James Fielding Ltd held 11.2% of AGP through a nominee company and tried to push for the company’s liquidation, but were reported to have sold out on 19 September.
The day after the AGP strategy was approved, SEA was in the High Court in Auckland seeking to strike out the application of Christchurch businessman John Powell & his company, Latimer Holdings Ltd, to be paid out of their $4.4 million investment in Trans Tasman at fair value â€“ which they said should be net asset value — under the “oppression of minorities” clause of the Companies Act, section 174.
Much of the Powell evidence concerned the management contract at AGP, which lawyers for Mr Powell said favoured SEA rather than Trans Tasman, as the holder of the controlling interest in AGP.
Justice Hugh Williams reserved his decision on the strikeout application.