In a statement issued yesterday, RFM announced that its ‘revaluation’ proposal – which would see the Chicken Income Fund, Riverbank Fund and Australian Wine Fund merged and listed on the ASX as 'Rural Funds Group' – has received “overwhelming support” from shareholders.
“Following the unit-holder vote implementation of the merger is underway with the listing likely to occur in late January,” said RFM managing director David Bryant.
“Most of our investors have been with us for more than a decade and finding an equitable way for them to liquidate their holdings at a time of their choosing was the priority for RFM and the vast majority of financial advisers who guide our investors”.
However, as previously reported by InvestorDaily, a number of Melbourne-based financial planners have voiced strong opposition to the deal, describing it as more of a “takeover” than a merger.
IAG spokesperson deLancey Worthington, a portfolio manager at boutique firm Segue Financial Services, told InvestorDaily that RFM’s proposal to merge and list the three funds is not in the best interests of Segue’s clients.
“[IAG] are the only ones standing up to this and saying it is wrong,” Mr Worthington said. “[The proposal] is being painted as a merger but really it is a takeover.”
Mr Worthington said IAG is concerned that the proposal “contravenes ASIC guidance” by failing to ensure that the “protection of existing unit holders” is upheld, with specific concerns over the possibility of transaction costs being fronted by unit holders under the deal, and a perceived lack of compliance with the “arm’s length” principle.
Earlier this month, RFM admitted making a number of misleading statements to the market and issued a formal apology, as disputes over the proposed merger of three funds continue.
“It has been brought to our attention by ProTen that some of the statements we have made are not true and we wish to apologise to ProTen for any damage it has suffered as a result of us having made those statements,” said a letter from RFM spokesperson Andrea Lemmon, obtained by InvestorDaily.
