KEY POINTS:
Opposition from the wealthy Cushing family helped defeat plans by The National Property Trust to change its fee structure at a large investor meeting in Auckland yesterday.
The meeting was marked by terse exchanges between various factions over whether a series of proposals should go ahead.
A number of investors called for the trust's $300 million of property assets to be sold and the money paid out to investors, saying it was the single worst-performing trust in the listed property sector.
The manager of the trust proposed to reduce the base management fee but charge a performance fee linked to the NZX Property Index. The manager is controlled by interests associated with troubled financier St Laurence.
The Cushing family's investment vehicle, H&G, had already declared it would vote against fee changes and David Cushing spoke out strongly against the proposal, saying the only winner would be St Laurence.
He backed research from ABN Amro Craigs opposing the timing of the change and attacked the board for running an under-performing business. The trust was small, its unit price net tangible asset backing was $1 yet it was trading at only 50 cents and St Laurence had much-publicised financial issues which did not reflect well on National, Cushing said.
"H&G wants to put a resolution to wind up National in an orderly manner and have the proceeds returned to unitholders," he told the meeting.
Kevin Podmore, chairman of National's manager, put up a proposal to sweeten the fee deal.
He said the manager would defer its right to take out the performance portion of the fee for three years.
But this was still not enough and the fee change proposal was defeated.
Five other proposals put to the meeting were approved.
They gave the investors more power, including the right to put motions to meetings which they were previously denied; the right to vote for independent directors; and the stipulation that those directors must stand down after three years.
Podmore said after the meeting that St Laurence investors would meet in September to discuss issues with that business.
Podmore and associates own Auckland's Hilton Hotel and he said he planned to put forward a proposal to St Laurence investors involving this property.
