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This comes after 51.3% of shareholders voted against Weiss during the company’s annual general meeting.
Cromwell Property Group managed to fend off a bid by its largest shareholder, Singapore’s ARA Asset Management, to have Gary Weiss onto the board.
This comes after 51.3% of shareholders voted against Weiss during the company’s annual general meeting on Thursday (28 November), reported Bloomberg.
Prior to the meeting, Cromwell said Weiss is conflicted since he sits on the boards of firms including Straits Trading Co., which owns shares in ARA.
However, ARA said Weis is not involved in any commercial transactions or management that could lead to conflicts.
ARA first entered the register of Cromwell in May 2018 when it purchased a 19.5% stake. With over S$83 billion in gross assets managed, the group has raised its stake to just under 24%.
“The result today provides ARA with encouragement to continue to seek necessary change through direct engagement and dialogue with our fellow Cromwell securityholders,” it said in a statement.
ARA revealed that it is “increasingly concerned” on aspects of Cromwell’s performance, noting that the company’s investments in Europe, which include those in the Polish retail sector, have been mostly destructive to shareholder value.
“Our focus is on ensuring the underlying performance of the Cromwell business improves, which will, in turn, maximize the value of Cromwell securities over the medium and long term.”
Cromwell, on the other hand, claimed that its investments yielded a 38% return in the 12 months through 31 October.
Cromwell shares rose 25% this year after dropping by almost 10% since ARA began purchasing the shares in May 2018 through the end of that year.
In October, ARA denied speculation that it plans to make a bid for Cromwell following its acquisition of shares which are now valued at more than A$770 million (S$711.5 million).
Cromwell believes ARA – now one of the biggest real estate fund managers in Asia – is acting for its “own strategic objectives, including a proposed future IPO, in mind”.
Based on general accounting principles, a stake of more than 20% enables ARA to claim the assets under management of Cromwell as its own as an associate. In fact, its S$83 billion assets include those of Cromwell.
“ARA are a competitor with their own plans in a number of the markets Cromwell operates in and have also publicly indicated an intention to list in Singapore when they reach S$100 billion funds under management,” said Cromwell.
Delisted in April 2017 from the Singapore stock exchange, ARA refused to comment on its relisting plans.
Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg
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