Treasury China Trust (TCT), a Singapore-listed investment trust, is suddenly having to defend itself against charges from one of its investors that the firm is run for the benefit of its fund managers and lacks independent board oversight.
Mano Sabnani, a minority shareholder in TCT wrote a letter to Singapore’s Business Times newspaper calling for an investigation by the Singapore stock exchange (SGX) into the way the property company is run. The letter indicated that shareholders of TCT’s trustee-manager, Treasury Holdings Real Estate Pte Ltd, have too much power in the company, and not the directors of TCT or its unit-holders.
Mr Sabnani also noted that although Goldman Sachs had been appointed by the trustee-manager to advise on closing the gap between net asset value per unit and the trading price of the TCT units, Goldman’s report had not been made public.
Responding to the accusations in an interview with the Irish Times, Richard David, chief executive of Treasury China Trust (TCT), denied the charges and indicated that controls over the group’s management by Singapore regulatory bodies should be sufficient to protect shareholders’ interests.
“I’m not decrying any other listing environment, but the Singapore Stock Exchange (SGX) are very diligent about these matters and if they had any concerns around corporate governance, I’m sure they would let us know,” said Mr David, who is executive director of TCT’s trustee manager, Treasury Holdings Real Estate Pte Ltd (Thre). and TCT’s chief executive.
In the interview, Mr David rejected the implications in the letter that Mr Ronan and Mr Barrett’s ownership had compromised the trust’s corporate governance.
“There are no specific instances of a lack of corporate governance given,” David said. “We are a majority independent board. Is he suggesting that there is something wrong with the independent directors? Just because Johnny Ronan and Richard Barrett own 30 per cent of the company, the company is poorly run?”
TCT listed in Singapore in June 2010 and has substantial real estate holdings in China. Treasury Holdings directors Richard Barrett and Johnny Ronan hold a 30 per cent stake in TCT. Treasury Holdings itself holds no units in TCT.