Disgruntled ARA Logos unitholders should vote

SOME readers of The Business Times took umbrage at this column's suggestion a fortnight ago that minority unitholders of ARA Logos Logistics Trust might choose to support its proposed merger with ESR-Reit.

The point I was making was that once ESR Cayman acquires ARA Asset Management, there is likely to be uncertainty as to which of the two real estate investment trusts (Reits) will benefit from the asset pipeline of their combined parent group. A merger of ARA Logos and ESR-Reit would negate this issue of their overlapping mandates.

The problem is that the terms of the proposed merger obviously favour unitholders of ESR-Reit over unitholders of ARA Logos. Indeed, the merger announcement on Oct 15 immediately triggered a sell-off in ARA Logos versus ESR-Reit.