SINGAPORE – The trustee of Sabana Industrial Real Estate Investment Trust (Sabana Reit) has established an internalisation committee, which includes several employees from activist investor Quarz Capital.

This is among several moves the trustee has made to prod along the internalisation of the Reit manager.

Giving an update to unit holders on March 22, the trustee – HSBC Institutional Trust Services (Singapore) – said it was working with the relevant parties to implement resolutions passed at the last extraordinary general meeting (EGM) held on March 8.

It added that it has identified the necessary steps to implement the said resolutions and is reviewing the impact that these resolutions have, or may have, on existing workstreams for the internalisation process.

Unit holders of Sabana Reit had voted for eight out of the 10 resolutions proposed by Quarz Capital, which relate to how the trustee should handle the internalisation of Sabana Reit.

The Sabana Growth Internalisation Committee, which was set up by unit holders including Quarz, first requisitioned an EGM in December to direct the trustee on the internalisation process.

It said then that unit holders were highly dissatisfied and concerned about the trustee’s lack of progress on the process.

The resolutions that unit holders were in favour of included directing the trustee to form an internalisation committee, which includes several Quarz employees.

Another resolution called for a maximum price of $10 million to acquire the existing external manager within a month of the EGM.

The unsuccessful resolutions were related to the trustee being directed to provide written updates on the internalisation process every month, and for the trustee to disclose correspondence and a summary of the matters discussed with each owner or beneficiary of the Sabana Reit manager.

In its update, the trustee said it had written to ESR Group – owner of the Reit manager – to seek its views on whether it would be willing to consider the acquisition of the manager for a maximum all-in purchase price of not more than $10 million.

But, as at March 21, the trustee had not received a response from ESR Group. The trustee will thus keep unit holders updated if there are material developments.

The trustee has also made progress on the resolution to establish an internalisation committee.

The committee was set up on March 21, with members Imran Chng Pia Ser, Lim Hock Chuan, Havard Chi Cher Pan, Low Chin Yee, Jan Frederic Moermann and Sasha Anshuman Manabendranath.

The trustee has contacted the committee members and a meeting was set for March 25 to discuss the internalisation process, among other matters. Details of the initial meeting will be shared with unit holders.

The trustee has also written to the Monetary Authority of Singapore and Singapore Exchange to seek guidance on the issue of whether the manager, its shareholders and related parties ought to be permitted to vote on any resolution to amend the trust deed.

It also intends to amend its originating application, filed on Jan 9, to seek the court’s guidance on this issue, as well as to modify and update the proposed amendments to the trust deed.

Aside from the resolutions, HSBC Institutional Trust Services has also made progress on other existing internalisation workstreams.

This includes identifying a list of qualified candidates to put forth as directors of the new internalised manager.

Units of Sabana Reit closed flat at 36.5 cents on March 25. THE BUSINESS TIMES