The outcome of a shareholder fee and governance revolt against the manager of Vital Healthcare Properties Trust has been announced with three out of five non-binding proposals passed.

The business, with a market capitalisation of $914m, is a major medical and health property investor here and in Australia and three institutions have put resolutions put to the meeting which could change Vital.

Accident Compensation Corporation, ANZ New Zealand Investments and Mint Asset Management want the business overhauled but Canada's NorthWest Healthcare Properties Management, which runs Vital and owns more than 24 per cent, has been unanimously opposed to the reforms.

Unitholders voted in favour of a proposal on directorships by 53 per cent, backed two management fee change calls by 54 per cent and 50 per cent but did not back a call to change the board composition or policies and procedures, with 53 per cent of unitholders voting against those two proposals.


Incumbent director Graham Stuart will return to the board, the NZX notice said. Unitholders voted 67 per cent in his favour. Stuart's votes exceeded those of a new director who the activists wanted on the board, Paul Mead. David Carr, Vital chief executive, will step down from the board, the NZX notice said.

On the other resolutions put by the activist institutions, the manager indicated change could be on the way.

"The manager confirms that it has already established a process to deal with the substance of proposals 1, 2 and 3 including a board-led review of management fees in the first quarter of 2019," the NZX statement said. That was announced on November 23, it said.

The three institutions put forward five proposals which were voted on before and at yesterday's annual general meeting at Ellerslie. Those were:

• Removing the power of the manager to increase its fees;

• An independent review of the management fees;

• Requiring the manager to negotiate in good faith to lower fees;

• Altering the trust deed to give more power for unitholders to appoint and remove directors and less power to the manager;

• Electing Paul Mead as a new independent management board director instead of Graham Stuart, appointed by the Vital board and who is standing for re-election.