Shopping centre operator Atrium European Real Estate is under more pressure from returns-starved small shareholders, as the fallout continues from a failed take-private bid by Gazit Globe.
Minority shareholder, Icamap Investments, has issued a strongly worded letter to Atrium’s board of directors - which Gazit controls as the majority shareholder.
The investor states it is ‘immeasurably displeased by the lack of communication and transparency,’ on the matter of when missed dividends will be paid and the ongoing absence of asset sales to generate value.
Gazit’s bid to acquire Atrium at €3.75 a share triggered a rebellion by small shareholders in October, who believed the offer significantly undervalued the company. The true value is €5.05 per-share, they said. Gazit's bid was rejected by shareholders in a vote.
Calling on Atrium’s board to ‘take their fiduciary duties seriously and generate value for all investors,’ Icamap has now set out a series of pressing concerns it has.
‘The offer process has been hugely costly in both financial terms and management time,’ said Icamap. ‘These have not been allocated with the full benefit of the minority shareholders in mind.’
‘The Company should return capital to shareholders as soon as possible. This pertains to both the €60c per share payment of special dividend that was promised to be paid as mentioned in the offer prospectus and the re-introduction of the quarterly dividend payment policy come 2020. There is no reason not to return €60c per share to shareholders, listed or not.
‘We urge the Company to step up selling assets around book value, which would further underpin the net asset value of the company.
‘Proceeds should be returned to shareholders via special dividends and real value would be created, significantly more than the proposed offer earlier this year. This is not an impossible exercise.
‘The company successfully disposed of €298m of more secondary assets in July at c. 3% premium to the 31 March book value and an agreement has been reached for the €37m sale of Atrium Duben in Zilina, Slovakia, at book value.’
Atrium owns 32 properties in central and eastern Europe with a total gross area of more than 870,000 m2 of letting space and with a total market value of €2.7 bn.
An Atrium spokesperson told PropertyEU: 'Atrium remains focused on creating long-term value for the company and all its shareholders. As stated in Atrium’s third quarter trading statement, the board is reviewing the company’s distributions. The review process is ongoing and the company still intends to update the shareholders this year.'