Chief executive Angus McNaughton defends himself at yesterday's meeting. With him are Wal Edgell and Geoff McWilliams. Picture / Glenn Jeffrey
Unitholders in real estate investor Kiwi Income Property Trust yesterday rounded on management over the trust's strategy and the way it disclosed information.
But an overwhelming number of proxies received before the trust's extraordinary general meeting resulted in 80.4 per cent of investors voting in favour of the main order
of business - to increase the trust's debt capacity.
Trust chairman Sean Wareing said votes were received from the holders of 249 million units in favour of the motion and 61 million against.
The move allows Kiwi to increase its debt capacity from 35 to 40 per cent, moving from the $261 million debt borrowed as at September last year to a possible $440 million.
The debt could be used for three Kiwi deals - the Sylvia Park development in South Auckland, buying more shares in potential takeover target Capital Properties, or revamping The Plaza shopping centre in Palmerston North.
But the meeting attended by about 100 unitholders heard harsh criticism of the trust, including criticism of the rules governing the management entity and the trust.
The directors of Kiwi's managers threw the mud back after the meeting, accusing the unitholders of being ill-informed and a vocal minority who had no idea of the real issues.
Business Herald columnist and Kiwi proxy holder Brian Gaynor, proxy holder and Shareholders Association research director Oliver Saint, and unitholders Anthony Nottingham of Britain and Peter Kammler of Warkworth were just some of the crowd expressing deep displeasure about the trust's moves.
Brook Asset Management's Simon Botherway raised alarms about the extra debt and called for "a concise statement about the risk".
Gaynor attacked Kiwi chief executive Angus McNaughton for information in yesterday's Business Herald where McNaughton hinted how the extra debt could be applied.
Gaynor said the information memorandum sent to unitholders was scant on detail about how the debt could be used.
McNaughton apologised but defended himself. "In hindsight, we should have put more information in the notice, and I'm not perfect," he told Gaynor, defending the release of information, saying it was already widely available, that he took his disclosure obligations seriously "and sometimes I go overboard about not putting a foot wrong".
