SINGAPORE (April 6): The manager of Sabana Shariah Compliant Real Estate Investment Trust announced this morning that the extraordinary general meeting requisitioned by 66 unitholders will be held on Apr 28.

In the circular, the resolutions to be voted on are similar to those put forward by the requisitioning unitholders. The overall objective of the resolutions is to replace the existing external REIT manager with an internalised REIT manager to be wholly-owned by Sabana REIT, and if the internalised REIT manager is not approved by the Monetary Authority of Singapore, for Sabana REIT to be wound up.

Resolution 1 is to remove the manager. The other resolutions depend on the outcome for Resolution 1. Resolution 2 is to instruct the trustee to incorporate a wholly-owned subsidiary to replace the manager for the purpose of internalising the manager REIT management function and search for qualified candidates to be appointed as the directors of the internalised REIT manager.

If the newly-incorporated subsidiary is not approved by the relevant authorities to act as the manager of Sabana REIT, Resolution 3, to wind up the REIT, will be put to vote.  If Resolution 1 is not passed, Resolution 4, to wind up the REIT will be put to vote.

If Resolution 1 is passed, the manager will proceed to put forth Resolution 2 for voting. Resolution 4 will not be put forth for voting. If Resolution 1 is not passed, the manager will proceed to put forth only Resolution 4 for voting. Resolutions 2 and 3 will not be put forth for voting.

Many pages are devoted to defending the manager’s performance and fee structure, and on explaining why the manager has performed poorly over the past four years.

However, the REIT manager warns that voting it out “may trigger various breaches of obligations, events of default and early redemption obligations under the financing arrangements implemented by Sabana REIT,” according to the circular.

Since the dissident unitholders requisitioned for an EGM, Sabana REIT has attracted plenty of interest. On March 3, according to a company filing, e-Shang Redwood, which owns 80% of Cambridge Industrial Trust’s manager, and 12% of its units, announced it held 5.01% of Sabana REIT.

The other major unitholders are Vibrant Group which owns 12% including through its controlling interest in the manager, and Tong Jinquan with around 6.18%.