Eve Maddock-Jones, Investment Week, 28 March 2024:
The proposed merger between abrdn Property Income (API) and Custodian Property Income REIT (CREI) has been voted down by shareholders, triggering the trust to enter a managed wind-down as a result.
API held two series of meetings where shareholders voted on the motion on Wednesday (27 March), its annual general meeting and API court meeting.
The proposal needed at least 75% by value of API shares voted at both meetings, and a majority in number of API shareholders voting at the court meeting in order to pass the motion.
In the end, 60.8% of votes cast were in favour of the proposal at the AGM, and 61.4% at the court meeting, failing to meet the 75% hurdle required to pass the motion. Overall, 86.15% by number of API shareholders voted at the court meeting.
As a result, the CREI merger has been terminated, and the scheme of arrangement implementing the CREI merger has lapsed.
In the lead up to the votes, API’s board had persistently backed the merger proposal and encouraged shareholders to support the move. If the deal was not passed, it said it would implement a managed wind-down instead, which is now subject to shareholder approval..
While the respective boards had been in favour of the merger, there had been concerns that the combination did not represent the best option for shareholders.
“As we said last week, we did not believe the terms of the Custodian bid presented good enough value for API shareholders, even accounting for a potential discount in the price that can be achieved for the assets in a managed wind down,” said Richard Williams, property analyst at QuotedData.
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