Urbus proposal succeeds

Investors in nine Waltus property syndicates voted overwhelmingly in favour of being taken over by Urbus despite some vigorous opposition at a marathon round of meetings yesterday.

Nearly 91% of Urbus’s investors who voted were also in favour.

Most of the opposition centred on the Albany Power Centre syndicate which was described by some of its investors as "the jewel in the crown" of the Waltus syndicates.

It is the only one of the nine syndicates that is worth more than the money investors put in. Launched in 1997, every $5,000 invested is going into Urbus at a nominal $7,959, although most of that will be as mandatory convertible notes. The Albany syndicate is valued at $53 million, a third of the $157 million worth of property owned by the nine syndicates.

After investors objected that the 15 minutes allotted to the Albany meeting was too little, chairman Warwick Hawes adjourned that meeting until after all the others and it eventually ran for nearly two hours.

Directors refused to accept a letter from a solicitor to one of the objectors, Dennis Hedley, proposing an alternative offer. Legal adviser Paul O’Regan of Chapman Tripp told the meeting that letter didn’t constitute an offer and that Albany’s directors couldn’t consider any alternative offer unless shareholders voted down the Urbus takeover.

Hawes also refused to accept motions from Hedley to delay the Albany vote or to amend the motions.

Several investors objected to Hawes conducting the syndicate meetings because he is also an Urbus director and owns 198,524 shares and 198,556 mandatory convertible notes in Urbus.

O’Regan said that "there’s absolutely no basis for saying that someone who has a conflict of interest can’t chair the meeting." Such conflicts are "a feature of New Zealand corporate life" and the only requirement is that such conflicts be disclosed.

He did admit that New Zealand Stock Exchange rules are different and that Hawes could not have chaired the syndicate meetings had the syndicates been listed. Urbus directors have requested its shares be listed on the NZSE.

Urbus was formed in late 2000 from the merger of 27 Waltus syndicates. Its shares, nominally worth $1 at the time of the merger, last traded at 81 cents.

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