Investor advisory firm Glass Lewis backs Ires Reit board ahead of EGM

Glass Lewis has recommended that shareholders vote against all resolutions proposed by rebel shareholder Vision Capital at the EGM.

This comes less than a week after investor advisory firm Institutional Shareholder Services (ISS) also recommended that shareholders reject the upcoming bid to unseat the Ires board.

The call to remove the company’s current board is one of a number of resolutions proposed by Canadian fund Vision Capital at the EGM as it looks to take control of five out of nine board seats.

Vision has also called for the business to be taken off the stock exchange or for its assets to be sold off.

In a note from stockbrokers Goodbody, analyst John Cronin also pointed to a sale of shares by Canadian real estate investment trust Capreit, the largest shareholder in Ires, which took place yesterday.

The sale reduced the company’s shareholding to 18.5pc from 18.7pc.

Capreit has already declared its support for Vision’s proposals.

“This could be seen as a mechanism to stimulate undecided shareholders to side with Vision in the context of the EGM voting, ie the credible threat of a large seller, possibly on an ongoing basis in the open market,” Mr Cronin wrote.

However, he added that the sale could also indicate a lack of confidence in Vision’s resolutions.

“Others might interpret the Capreit stock sale as a signal that Capreit is not confident that Vision’s resolutions will succeed and has decided to start selling at a share price that is considerably stronger than it was just prior to the publication of Vision’s proposals on 18th December last,” he wrote, adding that Goodbody feels this is not a “likely explanation.”

Jeffrey Olin, chief executive of Vision Capital, told the Irish Times Inside Business Podcast earlier this week that the fund had around 36pc publicly declared support for its proposals amongst Ires Reit shareholders.

These shareholders who have already stated their support for Vision include Capreit, as well as Ewing Morris & Co Investment Partners, a 0.7pc shareholder.

The company has around 3,700 units in Dublin and Cork which had a combined value of €1.43bn in June last year.

Around 238 of these were added in the past two years.

The units currently have 99pc occupancy.

Ires plans to launch a strategic review of the business to consider its future operations.

It announced earlier this month that the review would consider options, including consolidation, mergers, a review of the company as a listed Reit, a sale of the entire issued capital and the sale of assets.

Ires added that moderating inflation, as well as potential reductions in interest rates and greater financial stability, offers the company more flexibility in considering these options.