Composition launches VinaLand counter-proposal
Composition Capital Partners, which is leading a shareholder revolt against the board of VinaLand - a Vietnam real estate fund - over reorganization plans, has now launched a counter-proposal.
The reorganization is scheduled for approval at an extraordinary general meeting (EGM) of shareholders to be held in Zurich on November 21. Composition had requested an adjournment but it was rejected. The real estate fund investor previously stated that the reorganization does not sufficiently address shareholders' interests.
With the Vinaland stock trading at more than 50% discount to the 2006 IPO price and at a 60% discount to current net asset value, Composition said the investment manager, VinaCapital, had claimed excessive performance fees based on on-paper-only profits that have never materialized for shareholders. It added the reorganization preserved this misalignment.
"In support of its stance to refuse an adjournment of the EGM, VinaLand's Board claims that ‘the manager will not allow any concessions to the current proposal'. This confirms our belief that, since the moment the board had agreed terms with the manager on the shape of the reorganisation, it has never been receptive to alternative ideas suggested by shareholders in any meaningful way," said Willem-Jan Pelle, a principal with Composition.
The counter-proposal launched by Composition calls for a critical analysis of a suitable management fees; an incentive scheme re-aligning the manager's performance fee with the performance provided to all shareholders and a major overhaul of the company's corporate governance.
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