ESR Group Files High Court Application to Halt Sabana Reit's EGM

ESR Group files High Court application to stop Sabana Reit's extraordinary general meeting (EGM) scheduled for May 24, 2024. The EGM was called to consider resolutions raised by activist investor Quarz Capital and four other unitholders.

author-image
Aqsa Younas Rana
New Update
ESR Group Files High Court Application to Halt Sabana Reit's EGM

ESR Group Files High Court Application to Halt Sabana Reit's EGM

ESR Group, the sponsor of Sabana Industrial Real Estate Investment Trust (Sabana Reit), has filed an application to the High Court of Singapore to stop the Reit's extraordinary general meeting (EGM) scheduled for May 24, 2024. The EGM was called by Sabana's external manager to consider resolutions raised by activist investor Quarz Capital and four other unitholders of the Reit.

Why this matters: This development highlights the ongoing struggles within Sabana Reit's management and governance structure, which could have significant implications for the trust's future direction and performance. The outcome of this High Court application may set a precedent for similar disputes in the Singaporean REIT industry.

The May 24 EGM is a result of a requisition letter issued by Quarz Capital and four other unitholders on March 25, 2024, which was later revised on April 18. The resolutions aim to address issues related to the internalisation of the Reit management function, which was approved by unitholders at an EGM on August 7, 2023.

ESR Group's application to the High Court seeks to halt the EGM until the final disposal of HC/OA 19/2024, a court application filed by Sabana Reit's trustee, HSBC Institutional Trust Services, in January 2024. The application aims to seek a declaration that amendments to the trust deed are required to implement the resolutions approved at last year's EGM.

ESR has also requested liberty to apply for further directions in respect of the EGM and for the costs of the court application to be provided. Units of Sabana Reit remained unchanged at S$0.36 as of the midday trading break on Tuesday.

The manager of Sabana Reit stated that it will provide further updates on ESR's application should material developments arise. The High Court application adds another layer to the ongoing saga surrounding Sabana Reit's management and governance structure following the internalisation vote last year.

Key Takeaways

  • ESR Group files High Court application to stop Sabana Reit's EGM on May 24, 2024.
  • EGM aimed to address issues related to internalisation of Reit management function.
  • ESR seeks to halt EGM until court application HC/OA 19/2024 is resolved.
  • Sabana Reit's units remain unchanged at S$0.36 as of midday trading break.
  • High Court application adds to ongoing saga surrounding Sabana Reit's management.