Ires Reit is in unique talks to promote the Marker Residences, the crown jewel of its house empire, to Irish Life Funding Managers (ILIM), the Irish Unbiased understands.
he deal, which might fetch as a lot as €100m, seems to be a part of an try to quiet a possible shareholder revolt led by dissident investor Imaginative and prescient Capital.
The proposed sale to ILIM, considered one of largest shareholders in Ires, comes lower than two weeks after Imaginative and prescient, a Canadian fund with a 5pc stake in Ires, blasted the board for the corporate’s underperformance in a scathing open letter.
A deal for the Marker, which Ires purchased in 2014 for €50m, would immediately fulfill the pledge it made in its response to Imaginative and prescient to eliminate €100m of “non-core” belongings to grasp worth for shareholders.
However Imaginative and prescient has already rejected the potential transaction as “a knee jerk response” and a “poison capsule” that may destroy long-term worth within the firm, doubling down on its demand for Ires to be taken non-public.
The fund additionally advised that Ires may very well be promoting the Marker to ILIM as a “quid professional quo” to marshal votes in assist of the board on the AGM on Could 3. Imaginative and prescient has known as on shareholders to vote down 4 administrators, together with CEO Margaret Sweeney and CFO Brian Fagan, and to reject a number of resolutions on the assembly.
ILIM didn’t reply to a request for remark.
In a second open letter revealed this morning, Imaginative and prescient reiterated its earlier criticisms of Ires for poorly managing its funds and poured scorn on its latest strategy to asset gross sales.
“Effecting gross sales on this method is basically the worst of all worlds,” the letter mentioned. “Property are being bought in a disorganised method thereby diminishing proceeds, and [the] Ires asset base will probably be smaller which means the Reit’s normal and administrative bills, together with important board and administration remuneration bills, will probably be proportionately larger…”
The fund additional excoriated Ires for “tens of hundreds of thousands of euros of worth destruction” by failing to lock in fastened charges on its massive money owed firstly of the rising rate of interest cycle final summer time.
Ires did restructure its debt in December, however not earlier than the related charges rose by 3.4 proportion factors, Imaginative and prescient mentioned, considerably growing debt servicing prices and consuming into income.
In a press release to the Irish Inventory Trade, Ires mentioned it had “no additional remark to make past the general public statements launched so far”.
Imaginative and prescient chief government Jeff Olin claims to have the assist of sufficient shareholders to name a rare normal assembly if the Ires board doesn’t again off what he known as a “scorched earth” technique and are available to the desk on a sale of the entire firm.
Mr Olin mentioned he has acquired “an outpouring of assist” from massive and small shareholders alike, together with at the very least one main Irish establishment.
Ires founder Capreit, which stays an 18.7pc shareholder, has to this point remained silent on the problems raised by Imaginative and prescient, whereas additionally failing to return out in public assist of the Ires board.
Nevertheless, shareholder advisers Establishment Shareholder Providers and Glass Lewis have really helpful that traders again the board subsequent week.