Withdrawal of Special Meeting Request
18 May 2005
Withdrawal of Special Meeting Request – Constitutional Change to Be Put to AGM
Capital Properties New Zealand Limited announced today that Kiwi Income Property Trust has withdrawn its request for a special meeting of shareholders to consider a proposed amendment to Capital Properties’ constitution. Instead, Capital Properties and Kiwi Income have agreed that a proposed amendment having similar effect will be put to the annual general meeting of Capital Properties, which is due to be held on 15 July 2005.
The proposed amendment to Capital Properties’ constitution provides that any disposition of the management rights over Capital Properties’ assets will require the approval of an ordinary resolution of shareholders.
In April 2005, Capital Properties completed a process of seeking proposals for the purchase of the management rights over its property portfolio. This process had been initiated in response to the board’s concern that the market was not adequately taking into account the value of Capital Properties’ internal management structure. Having received and assessed proposals, the Capital Properties board concluded that a sale of the management rights should not proceed. At the time of announcing its decision, Capital Properties Chairman Colin Beyer said the board believed that the management rights sale process had been a very useful exercise and that the value of Capital Properties’ internal management was now better recognised by the market.
“ The market and our shareholders now better appreciate the benefit of a low cost internal management structure where all growth in net rental income and asset values accrues to the exclusive benefit of the company and its shareholders. Presently Capital Properties is the only one of the nine main listed property entities that provides these benefits,” Mr Beyer said.
“ This proposed amendment will serve to reinforce internal management as part of the company’s constitution, such that any move to external management can only happen with the approval of shareholders.”
To pass, the amendment must be supported by 75% of the votes of those shareholders voting on the matter at the AGM. The proposed form of constitutional amendment must also be approved by NZX.