Dasin Retail Trust substantial unitholder sues lead independent director, seeks his removal from board
DASIN Retail Trust’s (DRT) substantial unitholder Zhang Zhencheng is suing the trustee-manager’s lead independent director Tan Huay Lim on allegations that Tan’s conduct has been “oppressive” and “in disregard” to Zhang’s interests.
Under an original claim filed in the Singapore High Court last Thursday (May 25), Zhang, who is also a non-executive director and shareholder of Dasin Retail Trust Management (DRT’s trustee-manager) is seeking, among others, Tan’s removal from the board of the trust’s manager. This was indicated by an announcement by the manager to the Singapore Exchange (SGX) over the weekend.
The trustee-manager said that it was served the originating claim last Friday (May 26), and that it intends to contest the claim. Tan has informed the board that he intends to do the same.
Zhang is also seeking an order to restrain Tan from further involvement in DRT’s crucial refinancing exercise and discussions relating to a memorandum of understanding (MOU) with a “reputable Chinese entity”, indicated the statement to the stock exchange.
In a separate statement issued to the press, Zhang said that the MOU with a “foreign seller” – a deal that he alleged is being “pushed for” by Tan – is “adverse” to the trustee-manager, its shareholders and the trust’s unitholders.
He is also seeking for the trustee-manager to terminate FTI Consulting’s services in conducting an independent business review, and that FTI too be restrained from further involvement in the refinancing of the loan facilities.
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Alternatively, Zhang is seeking an order to restrain Tan from meeting with SGX unilaterally on the MOU and the refinancing exercise. He also wants to restrain Tan from taking any steps to prevent the management of the trust from participating in the refinancing of the facilities and the MOU.
Zhang is also seeking damages, interest, costs and other relief as the court deems fit.
“The majority of the board (Tan and Zhang abstaining) is of the view that the issuance of the Originating Claim against Tan does not warrant the trustee-manager requiring Tan to step down,” said the trustee-manager’s chairman and non-executive director Dr Kong Weipeng on behalf of the board in the announcement to the SGX.
The majority of the board views the dispute as “sub-judice” and under determination by the court. As such, the trustee-manager should not pre-empt the court’s decision, said Dr Kong, adding that Tan is considered by the board as an “invaluable member” owing to his skill set, knowledge and experience in auditing companies.
Tan was a partner at KPMG Singapore for 23 years before retiring in 2015, and has 30 years of audit experience as indicated by his bio on DRT’s website.
Units of DRT closed up 1.7 per cent or S$0.002 to S$0.121 on Friday.
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