A group of investors in PRS REIT have requisitioned an extraordinary general meeting to vote on the removal of its chairman and the implementation of a strategic review of the business.
The shareholders, who between them manage shares constituting approximately 17.3% of the issued share capital, want to see non-executive chairman Stephen Smith and non-executive director Steffan Francis removed from the business and replaced by Robert Naylor and Christopher Mills, with immediate effect.
If appointed, the requisitioning investors want the new directors to work with the remaining board members to undertake a review of options to return value to shareholders.
The call comes in response to the continuing discount to NAV at which PRS REIT’s shares trade.
Shareholders want a review of the business to be undertaken that could lead to a sale of its assets to repay debt where the cost of debt exceeds the net rental yield, a buyback of shares to target a discount to NAV of 10% or lower, or the potential sale of the whole business.
The group also wants to review all contracts between PRS REIT and its investment adviser Sigma PRS Management to ensure that the REIT has received sufficient value from transactions and that contracts contain appropriate robust provisions to enable Sigma to be held to account.
The shareholders said they believed there would be a “significant improvement in the value of the shares of PRS REIT” as a result of their proposed actions and they “strongly encourage all PRS REIT’s shareholders to support their proposals for change”.
The investors calling for the changes are Waverton Investment Management, CCLA Investment Management, Alder Investment Management, CG Asset Management and Harwood Capital Management, of which Mills is the ultimate majority shareholder.
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