MENU

Why are Westfield Group shareholders also against its corporate restructure?

A new survey undertaken by brokerage firm CLSA suggests that investors in shopping centre behemoth Westfield Group (ASX: WDC) are just as opposed as Westfield Retail Trust (ASX: WRT) investors to the corporate restructure that was proposed on December 4 last year.

Shareholders of the Trust are largely opposing the deal based on the enormous $1.8 billion management costs the new Scentre vehicle would be responsible for, but it seems that many security holders in the Group would also vote “no”. According to the survey, 58% of the Trust’s investors and 55% of Westfield Group’s shareholders are against the proposal based on today’s terms.

While the deal is believed to be tilted quite heavily in the Group’s favour, the question must be asked why its shareholders would be against the proposal? This is likely because many of the shareholders in the group also hold the Trust’s securities.

Foolish takeaway

A vote will be held on May 29 which will require a 75% approval rate for the proposal to proceed. It is widely believed the deal will need to be sweetened more in the Trust’s favour in order to win over more votes.

The top ASX pick you've never heard of...

Top Motley Fool analysts just identified their #1 ASX pick for 2014, a small-cap stock that could be poised for big gains (and offers a fat, fully franked dividend!). Discover all the details now, including the name and code, in this FREE investment report, "The Motley Fool's Top Stock for 2014."

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

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.