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Unit holders reject IOF board's JV proposal with A$10B office platform

Unit holders of Investa Office Fund, or IOF, voted May 31 against the board's proposal to acquire a 50% stake in Investa Office Management Pty. Ltd.

Overall, 248,802,119 or 55.97% of the votes cast in person or by proxy against the transaction with the A$10 billion platform prevailed; 195,761,208 or 44.03% were for it; and 4,839,474 votes were for abstaining, IOF said in a filing.

The planned internalization needed more than 50% affirmative votes in order to forge ahead.

IOF said its independent directors will still work with Investa Office Management to deliver returns to IOF unit holders. It also urged suitor Cromwell Property Group to clarify the status of its potential all-cash offer for the fund.

Since the proposal was announced May 8 after months of review, the A$45 million stake deal received mixed reactions. Among those who backed it was BT Funds Management, while those who expressed doubts about the benefits of such restructuring included Heitman, proxy adviser Institutional Shareholder Services and Cromwell, which reportedly called the stake buy the "worst of all worlds" for the fund's unit holders.

As of May 30, US$1 was equivalent to A$1.34.