Investors stop £1.7bn super trust

F&C ASSET MANAGEMENT was celebrating a dramatic victory last night after small investors shot down a merger between the F&C Commercial Property Trust (FCPT) and Ignis’ UK Commercial Property Trust (UKCPT).

Minority shareholders voted by a narrow margin to block the creation of a £1.7bn “super trust” by joining the two real estate funds. In an unusually rebellious gesture for the sleepy investment trust sector, 50.07 per cent of investors opposed the FCPT board’s recommendation. The ballot will be seen as a wake-up call for other management teams in the industry who have often taken shareholders’ cooperation for granted.

F&C, which was set to lose its mandate through the deal, had been passionately opposed. In an interview with City A.M. chief executive Alain Grisay said: “Our performance on that particular property trust was so good it was capped last year. So what is it these guys have done wrong?”

Yesterday the 140-year-old company met with the trust’s board to determine if its team, led by Richard Kirby, would continue at the helm.

Ignis and UKCPT had been confident of winning the vote. The tie-up was backed by both trusts’ boards and their two largest shareholders.

Chris Hill, chairman of UKCPT, said: “We are clearly very disappointed that we cannot proceed with the proposed merger, despite our shareholders voting strongly in support.”