p;C ASSET MANAGEMENT is braced for the worst today as investors vote on a merger of the F&C Commercial Property Trust (FCPT) and Ignis’ UK Commercial Property Trust (UKCPT).
F&C will be stripped of its mandate to run the £800m FCPT if shareholders agree to join the vehicles together to create a £1.7bn “super-trust”. Although the boards of both funds have agreed to tie up, with the backing of their two largest investors, a technicality means small shareholders hold the key in the crunch ballot.
F&C, which fiercely opposes the deal, and Ignis, which is in favour, have been sounding out shareholders in recent weeks. The vote is expected to be unusually close.
F&C has already lost control of the Eurotrust and Pacific Assets Trust this year, as well as closing its UK Select Trust. Last week, chief executive Alain Grisay told City A.M. the performance of F&C’s team on FCPT did not warrant a change of management.
“It would be pretty hard to make a stand and say it is in the interest of the shareholders to change the fund manager here, not with the track record our guys have,” he said.
In return, the board of UKCPT argued merging the trusts would create a larger, more liquid vehicle.