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Accordia Golf Trust: Conflict of interest 'reasonably resolved' in golf course deal
ACCORDIA Golf Trust (AGT) has said its audit and risk committee had considered a potential conflict of interest in appointing Daiwa Capital Markets Singapore as one of its joint financial advisers to assist with evaluating a non-binding proposal for the sale of all its golf courses.
The audit and risk committee is of the view that any potential conflict of interest has been "reasonably resolved and managed", the manager said in its response to queries from the Singapore Exchange on Dec 24.
In its response, the manager disclosed its ongoing relationships with Daiwa Securities Group and its subsidiaries - collectively the Daiwa Group - since the trust's initial public offering (IPO). Daiwa Capital Markets Singapore is a subsidiary of Daiwa Securities Group.
Daiwa Real Estate Asset Management (Dream), a wholly-owned subsidiary of Daiwa Group, owns a 51 per cent stake in AGT's manager. Dream, in connection with the trust's IPO, had also entered into an asset management agreement with the company that owns all of AGT's golf course assets.
Meanwhile, Daiwa PI Partners Co - another wholly-owned subsidiary of the group - holds 5.36 per cent of AGT's issued units as at Dec 24.
Among several reasons as to why any potential conflict of interest was reasonably resolved and managed, the manager said that as a unitholder, Daiwa Group's interest is aligned with other minority unitholders in ensuring the terms in the divestment of the golf courses are favourable to the trust.
Any potential influence by Dream as a 51 per cent shareholder of the manager has also been addressed with the recusing of Dream's board nominee Toyo Nakanishi from the selection of the financial adviser for the divestment.
The other independent joint financial adviser working with Daiwa Capital Markets Singapore is Ernst & Young Corporate Finance – which the manager confirmed there is no prior or ongoing relationship outside of its appointment to evaluate the divestment deal.
AGT units were trading at S$0.675 on Thursday as at 11.33am, down 0.5 Singapore cent or 0.7 per cent.