AMP Capital is understood to have hired Macquarie Capital in a desperate attempt to retain control of its $7bn prized wholesale office fund.
It comes with speculation mounting that investors in the AMP Capital Wholesale Office Fund are now considering an extraordinary general meeting to dump AMP Capital as its manager.
While it is understood that there needs to be 75 per cent shareholder support to elect a new manager through a vote, some believe that tensions between investors and AMP Capital have reached fever pitch and they are moving to replace the manager regardless and risk being sued by the Australian financial.
AMP is believed to be seeking legal advice.
It comes after adviser Jarden and an independent advisory board recommended to AWOF’s trustee board in the past fortnight to put a vote to shareholders to consider three options – retaining AMP Capital as manager; replacing the manager with Mirvac Group, which would offer development opportunities; or merging with an unlisted fund managed by the GPT Group.
The understanding is that the trustee board did not accept the recommendation, prompting the independent advisory board to resign last week.
Investors are fuming, according to market sources, who say that the GPT and Mirvac proposals had far lower fees and better development and acquisition opportunities.
The independent advisory board to AWOF’s trustee board consists of some of the most respected names in real estate and corporate circles, including former Future Fund property head Barry Brakey, Wesfarmers director Sharon Warburton and veteran property company director Paul Say.
The AMP trustee board has since drafted in two other independent directors – corporate veterans Ming Long and Bob McKinnon, but the point of tension for investors is that both hold non-executive roles elsewhere in the AMP empire.
Ms Long, a former Investa Office Fund head, chairs AMP Capital Funds Management Limited, and Mr McKinnon, who was at Westpac and the Commonwealth Bank, is also a non-executive on this board.
The trustee board consists of executives from AMP Capital and are not considered to be independent by investors due to their AMP links.
It is understood AWOF’s investors themselves are understood to have recently been holding talks to establish the best party to take over the running of the fund after major staff losses in AMP Capital’s real estate unit has prompted them to seek alternatives.
However, it is understood that opinion is divided over Mirvac and GPT, with some concern that neither party alone has enough support to gain 75 per cent investor support.
The plan had been that once recommended groups were put forward to investors, they would cast their vote on what party they believed was the best to manage their interests around the middle of October.
There are about 40 investors in the fund, major investors include UniSuper, Victorian Funds Management Corp and Treasury Corp.
AMP Capital’s real estate and infrastructure units have been under attack from rivals hoping to wrest control of its funds away from AMP after a tumultuous few years that included revelations from a royal commission of fees being charged for no service, sexual harassment claims against former AMP Capital boss Boe Pahari and a string of departures among top staff.
Already, investors in the $5bn-plus AMP Capital Diversified Property Fund have voted to replace AMP Capital as its manager with Dexus.
AMP Capital has been earmarked for demerger, but some believe those plans may be derailed should AWOF fall into the hands of another manager.
AWOF consists of prized office assets including a stake in the Quay Quarter complex at Circular Quay, the office complex at Sydney’s Angel Place and its Collins Place office development in Melbourne.
AMP comprises a bank, wealth management unit and the AMP Capital funds management arm.
Shares in AMP have plummeted from more than $5 about five years ago and are currently at 94c.
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