Aims Property Securities Fund · ASX:APW
Aims Property Securities Fund — Proxy Contest (November 2018)
29 slides from Aims Property Securities Fund's proxy contest presentation, Nov 22, 2018
Slide 1: SNC and Samuel Terry correspondence to unitholders of the AIMS Property Securities Fund
Sandon Capital Investments Limited ACN 107 772 467 Level 5, 139 Macquarie Street Sydney NSW 2000 ASX Announcement 22 November 2018 For personal use only SNC and Samuel Terry correspondence to unitholders of the AIMS Property Securities Fund Entities managed by Sandon Capital Pty Ltd, including Sando
Slide 2: Letter to unitholders of the AIMS Property Securities Fund
For personal use only SANDON CAPITAL AND SAMUEL TERRY LETTER TO UNITHOLDERS OF THE AIMS PROPERTY SECURITIES FUND (“APW”) Vote FOR resolutions to wind up APW and return cash to unitholders Dear fellow APW unitholder, You have recently been sent two Notices of Meeting for APW, one being held on the 7t
Slide 3: Your vote is important: vote for a wind up of APW
AIMS Property Securities Fund (APW) For personal use only YOUR VOTE IS IMPORTANT VOTE FOR A WIND UP OF AIMS PROPERTY SECURITIES FUND AT BOTH UNITHOLDER MEETINGS Samuel Terry and Sandon encourage you to VOTE FOR a wind up of APW at both unitholder meetings. If you cannot attend the meetings please co
Slide 4: Important Information
Important Information The information contained in this presentation (Information) is based on publicly available information about AIMS Property Securities Fund ARSN 111 442 150 (Fund or APW), which has not been independently verified by Samuel Terry Asset Management Pty Ltd (or any entities manage
Slide 5: APW serves no purpose except to the AIMS Financial Group and should be wound up
Samuel Terry and Sandon believe APW serves no purpose, except to the AIMS Financial Group, and should be wound up. This would involve selling the Fund’s assets and returning net proceeds to unitholders For personal use only o APW units trade at a persistent and excessive discount to NTA, currently a
Slide 6: An orderly wind-up of APW is the best outcome for independent unitholders
AN ORDERLY WIND-UP OF APW IS THE BEST OUTCOME FOR INDEPENDENT UNITHOLDERS At its own expense*, Samuel Terry has called a unitholder meeting to be held at 10am on Monday 10 December 2018 at Level 4, 60 Carrington Street, Sydney NSW. At the meeting, unitholders will be asked For personal use only to v
Slide 7: George Wang quote on the real estate cycle
For personal use only “Currently, we find ourselves in challenging times, with value in the real estate sector being difficult to come by. Most assets are overvalued and sellers come to market with unrealistic expectations of price, which are surprisingly being met by local and foreign buyers…We bel
Slide 8: Why you should vote for a wind up of APW
Why you should VOTE FOR a wind up of APW 1. Persistent and excessive discount to 2. Related party conflicts and poor For personal use only NTA disclosure AIMS has allocated over 80% of unitholder money ~25% trading discount is NOT acceptable to other funds managed by the AIMS Financial Group, withou
Slide 9: 1. Persistent and excessive discount to NTA
Why you should VOTE FOR a wind up of APW For personal use only 1. Persistent and excessive discount to NTA ~25% trading discount is NOT acceptable 7
Slide 10: Persistent discount to NTA: 25% trading discount is not acceptable
Persistent discount to NTA: 25% trading discount is NOT acceptable Units have traded at a large discount to NTA for over ten years – currently approximately 25%. Unit price of $1.79* but the NTA (as at 30 June 2018) is $2.37 per unit. Such a large discount is NOT present in most other Australian REI
Slide 11: 2. Related party conflicts and poor disclosure
Why you should VOTE FOR a wind up of APW For personal use only 2. Related party conflicts and poor disclosure AIMS has allocated over 80% of unitholder money to other funds managed by the AIMS Financial Group, without disclosing all the fees it receives 9
Slide 12: Related party conflicts and poor disclosure: reimbursable expenses
Related party conflicts and poor disclosure In response to criticism, AIMS stopped charging management and performance fees directly to APW in December 2016. However, AIMS continues to be reimbursed for various expenses. When AIMS stopped charging management For personal use only and performance fee
Slide 13: Related party conflicts: investment strategy and double dipping
Related party conflicts and poor disclosure Samuel Terry and Sandon believe AIMS’ investment strategy is to recycle unitholder capital from independent and transparent investment vehicles to related party investments which increases the fees the AIMS Financial Group For personal use only receives %
Slide 14: Persistent requests for disclosure of all fees
Related party conflicts and poor disclosure Samuel Terry and others have persistently requested AIMS disclose ALL the fees the AIMS Financial Group receives from APW For personal use only Peers that consolidate the accounts of material, majority owned entities and disclose all fees paid to managemen
Slide 15: Murky sub-trusts managed by AIMS Financial Group
Related party conflicts and poor disclosure APW’s investments in murky sub-trusts managed by AIMS Financial Group maximise the fees AIMS receives For personal use only Below is a direct extract from APW’s 2016 Audited Annual Report Source: APW 2016 Annual Report, p32. • AIMS claims not to charge man
Slide 16: Spotlight on poor disclosure: AIMS Real Estate Opportunity Fund investment
Related party conflicts and poor disclosure SPOTLIGHT ON POOR DISCLOSURE: APW’s $19m investment in AIMS Real Estate Opportunity Fund • In December 2017, AIMS invested A$19m of APW unitholder funds (over 20% of APW’s NTA at that time) into a new investment vehicle For personal use only managed by ano
Slide 17: AIMS using APW unitholders' money to advance its own interests and control
Samuel Terry & Sandon believe that AIMS is using APW unitholders’ money to advance the AIMS Financial Group’s own interests and control As manager of MacarthurCook Office Property Trust, the AIMS Financial Group has invested MacarthurCook Office Property Trust’s money back into APW such that it now
Slide 18: AIMS Financial Group's holding in APW
Related party conflicts and poor disclosure By using independent unitholder money to gain control of MacarthurCook Office Property trust, the AIMS Financial Group has solidified its own control over APW independent unitholders For personal use only AIMS Financial Group’s holding in APW 7.6% 9.3% 5.0
Slide 19: 3. Investment performance is deteriorating
Why you should VOTE FOR a wind up of APW For personal use only 3. Investment performance is deteriorating 1.17% distribution yield to NTA is amongst the worst in class 17
Slide 20: Investment performance is deteriorating
Investment performance is deteriorating… Despite favourable property market conditions, APW’s investment performance is deteriorating… For personal use only APW’s distributions per unit are down more than 50% year • According to APW, the decline in distributions is “primarily due to the sale of unit
Slide 21: APW's distribution yield to NTA is among the worst in class
Investment performance is deteriorating… APW’s distribution yield to NTA is amongst the WORST IN CLASS For personal use only Distribution / Dividend yield to NTA 6.4% 5.0% 5.0% 4.8% 4.8% 1.2% Dexus GPT Group Mirvac Group Charter Hall Long Wale REIT ASX200 Property A-REIT AIMS Property Securities Ind
Slide 22: 4. Now is a good time to sell
Why you should VOTE FOR a wind up of APW For personal use only 4. Now is a good time to sell “the real estate cycle is at a high point” (George Wang, October 2018) Samuel Terry and Sandon have spent significant time and money researching APW’s assets, and believe they can be sold to realise the NTA
Slide 23: Now is a good time to sell
Now is a good time to sell Commercial property prices have risen substantially in recent years, and we believe it is a good time to sell. However, this will not last forever… For personal use only Prices are HIGH Yields are LOW “Currently, we find ourselves in challenging times, with value in the re
Slide 24: Samuel Terry and Sandon's interests are aligned with yours
Why you should VOTE FOR a wind up of APW For personal use only Unlike AIMS, Samuel Terry and Sandon’s interests are 100% aligned with yours. Samuel Terry and Sandon are calling this meeting at their own expense and will dedicate significant personal and financial resources to ensuring the best outco
Slide 25: Rebuttal of responses from AIMS
Rebuttal of responses from AIMS The Responsible Entity has demonstrated a track record of creating value for the Fund. • Excluding the TFML litigation win in 2014, APW’s total shareholder return has underperformed the ASX200 A-REIT index since AIMS took For personal use only control in 2009. • Over
Slide 26: Rebuttal of responses from AIMS (continued)
Rebuttal of responses from AIMS Samuel Terry and Sandon are opportunistic investors who have tried this before. If unitholders voted in favour of previous wind up resolutions, they would have missed out on APW’s recent returns. For personal use only • Samuel Terry and Sandon combined have approximat
Slide 27: An orderly wind-up of APW is the best outcome for all unitholders
AN ORDERLY WIND-UP OF APW IS THE BEST OUTCOME FOR ALL UNITHOLDERS Samuel Terry and Sandon believe APW serves no purpose, except to the AIMS Financial Group, and should be wound up. This would involve selling the Fund’s assets and subsequently returning the net proceeds to unitholders. For personal u
Slide 28: About Samuel Terry and Sandon Capital
Samuel Terry Asset Management Pty Ltd (Samuel Terry) and Sandon Capital Pty Ltd (Sandon) collectively own over 19% of AIMS Property Securities Fund (APW). They have agreed to work together with respect to the meeting of APW For personal use only members called by Samuel Terry. Samuel Terry is fund m
Slide 29: Appendix One: APW Total Return Calculation
Appendix Appendix One: APW Total Return Calculation We have calculated APW’s total return since inception excluding the TFML litigation win by comparing the 10 day volume weighted average price on the ASX 10 For personal use only days before and after its announcement on 15 May 2014. In determining
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