Irish Residential Properties REIT has urged shareholders to reject all resolutions at an upcoming EGM requestioned by activist shareholder Vision Capital and also said it plans to launch a strategic review of the company.
Irish Residential Properties REIT, the country's largest private landlord, said it will hold an EGM on Friday February 16 at 11am in Dublin.
Shares in the company ended 4.8% higher in Dublin trade today.
Last month Canadian-based Vision Capital had demanded an EGM be convened so that shareholders can vote on its proposal to replace five directors of its nine directors and also force the total liquidity of I-RES within two years.
Vision Capital, which owns 5% of I-RES, said it remains dissatisfied with the overall management of the company under the stewardship of the current board and executive management team.
It also noted the company's continued poor share price performance and its "persistent discount relative to the market value of its assets".
Irish Residential Properties REIT said Vision Capital's proposals seriously risks the value inherent in the assets and the platform of I-RES in forcing a risky and potentially value destructive approach that, while it might be in the interests of Vision, is not in the interests of shareholders as a whole.
The company today announced a comprehensive strategic review to consider the full range of strategic options for I-RES in order maximise value for shareholders.
The strategic review will start in the first quarter of 2024 after the company reports full year results for 2023.
It will consider all strategic options available to maximise the inherent value contained within the IRES portfolio of high-quality residential assets and the operating platform.
"The options will include, but not be limited to, new strategic initiatives, consolidation, combinations, mergers or other corporate action, a review of the company's status as a listed REIT, the sale of the entire issued share capital of the company, and selling the company’s assets and returning value to shareholders," the company said.
The company's board will also establish a special committee to initiate the strategic review and retain specialist international financial and real estate advice to assist with the process.
"As a Board, we believe now is the appropriate time to commence a strategic review which will evaluate the broad range of options to enhance shareholder value and capitalise on the opportunities inherent in our market leading portfolio and operating platform," Declan Moylan, the company's chairman, said.
"As we undertake this review, the company remains fully focused on continuing to deliver our strong operational and financial performance, as well as our market leading services to all of our residents in seeking to deliver value and establish alignment across our shareholders," he added.
In its resolutions, Vision has suggested the replacement of Declan Moylan, current chair of the board, retiring CEO Margaret Sweeney, current chief financial officer, Brian Fagan, and Joan Garahy and Tom Kavanagh, who are two other directors serving on the remuneration committee.
In their place, the shareholder is proposing the appointment of a number of new directors, including Mark Barr, Richard Nesbitt, Colm Lauder, Amy Freedman and Sharon Stern and that one of them would be elected chair.
Vision is also proposing that a process take place to find an internal or external candidate on either an interim or full-time basis to replace Margaret Sweeney as CEO, and that the candidate would be "aligned with the directives of the refreshed board."
IRES REIT has a portfolio of about 4,000 homes in Dublin and Cork. Its shares have lost around 40% of their value over the last two years.
