The latest statements published by Quarz Capital on June 28 demonstrate its attempts to drum up votes on false premises, says ESR Group in a filing on June 30. ESR Group owns Sabana Industrial REIT's M1GU manager and is the largest single unitholder of the REIT.
To date, Quarz has not identified a single instance of actual conflict of interests despite making various attempts to leverage off its allegations, ESR says.
In the said open letter, Quarz demanded Sabana REIT’s manager to table its resolutions as set out in its requisition notice, instead of the ones suggested in ESR's open letter on June 25.
“We further call upon the Sabana REIT manager to respect Singapore's legal framework for minority unitholder protection by permitting a fair vote on the removal of the Sabana REIT manager,” Quarz added.
In its response, ESR highlights that Quarz has made a fundamental and sudden “U-turn” on its original slated intention of internalising Sabana REIT to its current intention of removing the existing REIT manager. This drastic change detracts from Quarz credibility, says ESR.
ESR also claims that it has been made “patently clear” that Quarz’s true intention is to be involved in the management function of Sabana REIT. Highlighting that Quarz has no REIT management experience, ESR also points out that this is not the first time Quarz has sought to be involved — in June 2021, Quarz had proposed by way of requisition for resolution to appoint its representative Jan F Moemann as the REIT manager’s non-independent, non-executive director.
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Moving forward, Quarz has provided no plans regarding the management of Sabana REIT should the resolutions contained in the requisition get passed, either partly or in full, ESR adds. Its only proposed course of action is to redirect the responsibility of managing the negative consequences of its resolutions solely to the trustee, without consulting the latter’s willingness or availability to take up such a role.
“This is highly reckless and irresponsible. This effectively calls on unitholders to take a leap of faith with no concrete plan on the future of Sabana REIT. This only raises more alarm bells from a unitholder point of view and calls into question their true motivations for tabling the resolutions in the first place,” ESR says.
Units in Sabana REIT closed at an unchanged 43.5 cents on June 30.
