Activist shareholder tells Trikona to sell assets

An undisclosed shareholder at Indian real estate fund Trikona Trinity Capital has asked the fund to sell its assets “in the best interests of the company and the shareholders”, according to a filing on the UK’s AIM stock market.

An activist shareholder at Trikona Trinity Capital, the AIM-listed Indian real estate fund, has asked for all of its assets to be sold.

According to a statement posted on the junior London Stock Exchange, a “major shareholder” has proposed that the fund sells all its assets immediately and discusses the firm’s situation in an emergency general meeting.

The identity of the shareholder was not revealed but the largest shareholders in the fund are hedge funds QVT Financial, which holds 26.98 percent, and Carrousel Capital, which controls 14.3 percent. The latter has two executives on the fund’s board.

The asset sale proposal follows a decision by the Trikona board in December last year to order a strategic review of its capital distribution investment policy and strategy.

Today’s shareholder proposal argues that if the fund’s ordinary share price is below its net asset value (NAV) then capital should be returned to shareholders immediately. The shares are currently trading at 28 pence far below the fund’s NAV per ordinary share, which stood at 138 pence last September.

The shareholder is also understood to have proposed two other motions: that the fund sells assets until it has returned £100 million ($141 million; €112.5 million) in buybacks or has bought 70 percent of the company’s issued shares through buybacks.

The statement said: “The board has concluded that it is in the best interests of the company and shareholders as a whole to adopt a new investment policy to enable the company to continue to develop profitable assets, while facilitating the release of funds to shareholders as projects mature and markets improve.”

The shareholder rebellion at Trikona Trinity Capital comes just weeks after rival Indian property investor Hirco came under attack from one its shareholders, Laxey Partners. The London-based activist investor has called for an extraordinary general meeting to be held to push for a change of board members at the Indian firm.