Shares in Ires Reit closed unchanged on the eve of a crucial extraordinary general meeting (egm) on Friday, where an activist investor is seeking to replace five board members and push through a resolution aimed at a sale or breakup of the company.
A spokesman for Ires declined to comment on the result of votes cast by proxy on Wednesday, ahead of the meeting.
There has been speculation in Dublin investment circles that the rebel shareholder, Vision Capital, which owns a 5 per cent stake, may have secured sufficient backing to place two or three of its r nominees on the board.
However, it is widely believed that a Vision Capital special resolution to direct the company to seek to sell itself or dispose of its assets within two years will not be passed, as this would need approval of 75 per cent of votes cast. Director nominations only need a simple majority.
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Shares in Ires closed on Wednesday at €1.09, giving the company a market value of €577.2 million.
Vision Capital is seeking to replace Ires’s chairman Declan Moylan, chief executive Margaret Sweeney, chief financial officer Brian Fagan and two other board members, Joan Garahy and Tom Kavanagh. Mr Moylan and Ms Sweeney had already signalled that they are planning to step down in the coming months.
[ Ires says issue over EGM votes resolved ahead of deadlineOpens in new window ]
The five potential directors being lined up by Vision Capital include: former Arthur Cox partner and property lawyer Mark Barr; one-time chief operating officer of Canada’s CIBC Bank Richard Nesbitt; erstwhile head of real estate equity research at Goodbody Stockbrokers Colm Lauder; Amy Freedman, an adviser to Canadian asset manager Ewing Morris; and Sharon Stern, president of Eastmore Management and Metro Investments in the US.
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The central concern of Vision Capital, which has secured the backing of Ires’s founder, Canadian property group Capreit, which owns 18.5 per cent of the company, is the “inefficiency and limitations” of the real-estate investment trust (Reit) structure in Ireland and the discount at which Ires’s stock has been trading relative to the inherent value of its assets. Ires has 3,734 apartments and houses on its books.
The value of Ires’s net tangible assets, as measured under European Real Estate Association (ERPA) reporting standards, was €1.48 per share at the end of June.
Ires’s board, which last year vehemently resisted the notion of a sale, committed in early January to carrying out a strategic review of its own, following the publication of the company’s annual results later this month. This would look at “full range of strategic options” to maximise value for shareholders, including consolidation, mergers, a review of the company as a listed Reit, the sale of the company or disposal of its assets.
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