Here's why Westfield Group's shares are down 4.5%

Is this a good opportunity for investors to buy?

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Shares in Westfield Group (ASX: WDC) have retreated nearly 4.5% over the last month and are now trading at just $10.58 apiece after the Group failed to sell its restructure proposal to investors late in May.

While shareholders had been hoping for a result to end nearly six months of speculation, the vote was adjourned until June 20 based on indications that it would fail to receive the 75% approval rate needed from shareholders of the Group and Westfield Retail Trust (ASX: WRT).

Indeed, the merger proposal has been the subject of much controversy since it was announced on December 4 last year. While many investors are opposing the deal based on valuations, management agreements and costs, as well as merger ratios and gearing levels, others are just unenthused about yet another Westfield restructure!

Under the proposal, Westfield Group would merge its Australian and New Zealand assets with Westfield Retail Trust to form Scentre Group. The international assets would then be spun off into another separate entity, Westfield Corporation.

The deal has the backing of plenty of advisors, particularly since Westfield Group decided to sweeten the deal more in Westfield Retail's favour. High-profile broker and Bell Potter director Charlie Aitken is amongst those advising his clients to vote in favour of the proposal.

Is Westfield a good buy today?

Westfield Group's shares could certainly receive a boost should the proposal get the go-ahead when shareholders meet on Friday. Aside from giving investors a clearer indication of the direction of the entity, the restructure would also allow the company to improve its focus on funding its international development pipeline.

On the other hand, shares could also fall further if the vote does not get past Westfield Retail Trust shareholders. Given that a 75% approval rate was unlikely to be achieved in the vote held last month, there is every possibility that it may not receive the necessary backing this time around.

Until I have more certainty regarding the direction of the company, I am choosing to remain on the sidelines, even if that does mean I miss out on a gain should the deal go through.

Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned.

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