AXA Property Trust Limited
(a closed-ended investment company incorporated with limited
liability under the laws of Guernsey with registered number 43007)
LEI Number: 213800AF85VEZMDMF931
AXA Property Trust
Limited (the "Company") – Timetable for Publication of Audited
Financial Statements and Company Update
19 October
2018
As a result of the events described below, and despite the
Company’s best efforts, the Company's audited financial statements
for the financial year ended 30 June
2018 will not be published by the deadline of 31 October 2018 required by the Listing Rules.
The Company will however announce unaudited annual financial
statements prior to 31 October
2018.
Background
In August 2018 the Board issued a
Shareholder Circular (“the Circular”) with proposals and
recommendations to:
- put the Company into voluntarily liquidation in accordance with
the Companies Law,
- appoint Linda Johnson and
Ashley Paxton of KPMG Channel
Islands Limited as Liquidators, and
- cancel the admission of its shares to the Official List of the
UK Listing Authority and to trading on the Main Market of the
London Stock Exchange (the “Proposals”).
The decision to recommend the voluntary liquidation of the
Company was initiated in 2013 when the managed wind-down of the
Company was approved by Shareholders through a change in its
investment policy and objective with the intention of realising all
remaining assets and returning the proceeds to the shareholders in
an orderly manner. As a result, there is now only one asset
remaining in the portfolio, a property in Curno, Italy. As the managed wind-down has reached an
advanced stage, plans for the final winding-up and liquidation were
confirmed in an announcement on 22 June
2018 and were subsequently set out in detail in the
Circular.
The Circular included a review of the Company’s operating cost
structure having regard to the uncertain prospects of achieving a
sale of the Curno property and the reducing rental income. As a
result of this analysis the Board considered there were significant
cost savings that would be achieved.
It was also explained within the Circular that no financial
statements of the Company or updated NAV would be prepared for
the financial year ended 30 June 2018
or subsequent years once the liquidation was approved. This was
re-confirmed on 30 August 2018 when
the Company released unaudited financial information for the period
ending 30 June 2018. In expectation
of the Proposals being approved, the existing auditor to the
Company, KPMG Channel Islands Limited, gave notice of their
resignation, contingent upon the Proposals being passed by letter
dated 5 July 2018.
Shareholder meetings
An EGM was scheduled for 7 September
2018, at which shareholders were due to vote on the
Proposals. The EGM took place as scheduled, but it was adjourned
until 21 September 2018 following the
attendance of representatives of shareholders accounting for
approximately 30% of the voting rights who expressed their
intention to vote against the Proposals, which required 75%
approval of those voting in order to be passed. The Board was made
aware of their intentions less than 24 hours before the meeting was
scheduled to start.
The Adjourned EGM took place on 21
September 2018. However, the Proposals were not approved. A
single shareholder came to hold a 29.8% interest in the Company
prior to the Adjourned EGM. At the Adjourned EGM, the Proposals
were supported by shareholders representing 38.3% of the issued
shares of the Company, amounting to 56.2% of those voting at the
Adjourned EGM. However, the shareholder holding shares representing
29.8% of the Company voted against the Proposals and effectively
blocked them as a 75% majority was required.
Audited annual financial
statements
As the Company retained its listing on the Official List of the
UK Listing Authority and is bound by the Disclosure Guidance and
Transparency and Listing Rules, arrangements are in hand to prepare
audited annual financial statements for the year ended 30 June 2018.
There are a number of factors which will need to be addressed as
part of the audit process which include;
- a multi-jurisdictional audit approach requiring overseas
subsidiary companies financial statements to be audited,
- independent scrutiny of the going concern presumption
applicable to the managed wind down strategy and requirement for
ongoing liquidity noted in the Circular, and
- short notice for the planning and execution phase.
In view of the above, the auditor has reported that it is not
possible to complete the audit in time for the Disclosure Guidance
and Transparency Rules deadline of 31
October 2018. It is unlikely that the audit will be
completed before 31 December 2018.
However unaudited annual financial statements for the Company are
being finalised and will be announced prior to 31 October 2018.
The Directors note that under Listing Rule 5.1.2 (2) the FCA may
suspend listing where the issuer has failed to publish financial
information in accordance with the Listing Rules. The Directors
will therefore be making a conditional request to the FCA that
listing of the Company’s shares be suspended, conditional upon
failure to publish the audited financial statements by 31 October 2018. An announcement on any future
suspension will be made as and when appropriate, whilst the Company
uses its best endeavours in the meantime to assist the auditors to
complete the audit of its annual financial statements.
Company update
The Directors have consulted with the shareholder who voted
against the Proposals. As indicated in the Company’s
announcement issued on 5 October
2018, the shareholder has indicated a wish to present an
alternative plan for the continuation of the Company with a
different investment policy and objective. The Directors note that
any proposal to amend the investment policy and objective of the
Company would require shareholder approval.
The Directors believe that such a potential proposal, if put
forward, would be a significant change from the Company's current
investment policy and objective, which was approved by more than
75% of those Shareholders voting at the EGM in October 2013 and which remains in place. The
Board therefore remains committed to continue with the Company's
current realisation strategy, in particular with respect to the
lease negotiations at Curno and the property’s subsequent disposal.
The Company will also continue to make distributions at the
earliest opportunity.
The negotiations with the tenant at Curno continue to progress.
The Board and the Investment Manager do not believe it is in the
Company’s interest to entertain a “forced sale” and believe that
the new lease agreement will be beneficial to the disposal
prospects of the property. It is anticipated that the new lease
agreement will be finalised and in place before year-end.
At the same time and in view of the fact that plans for the
significant cost savings identified in the Circular have been
affected whilst the Company remains listed, the Board and its
advisors will continue to review the Company’s ongoing operating
cost structure to identify and implement expense reductions where
possible
Further updates will be provided in due course.
Company website: retail.axa-im.co.uk/axa-property-trust
All Enquiries:
Investment Manager
AXA Investment Managers UK Limited
Broker Services
7 Newgate Street
London EC1A 7NX
United Kingdom
Broker
Stifel Nicolaus Europe Limited
150 Cheapside
London EC2V 6ET
United Kingdom
Tel: +44 (0)20 7710 7600
Company Secretary
Northern Trust International Fund
Administration Services (Guernsey)
Limited
PO Box 255
Trafalgar Court
Les Banques
St Peter Port
Guernsey GY1 3QL
Channel Islands