Morgan Stanley’s efforts to clinch a quick sale of the management platform to the $8.9 billion Investa Property Group are fading amid resistance from the group’s funds.
As revealed by The Australian last week, Mirvac has moved into exclusive negotiations for both the platform and the investment stakes in Investa’s listed and unlisted vehicles, IOF and ICPF. The trust has 10 days to quell a potential rebellion from the two funds.
At issue are concerns over how the Investa business will be managed by Mirvac, a diversified property trust that spans the residential, retail and office sectors. According to sources, the vehicles’ boards are concerned there may be governance changes in addition to potentially damaging cost-stripping measures.
Mirvac CEO Sue Lloyd-Hurwitz, a former executive at La Salle Investment Management, the underbidder for the Investa platform, is leading the charm offensive.
Yet while there have been assurances about how the transition will be handled, it’s understood both boards have demanded greater clarity. Sources said Mirvac may need to commit to some concessions in writing.
Without this certainty, the platform may fracture. IOF issued a statement last week reiterating its rights over a portion of its manager. But it is ICPF that represents the real prize for Mirvac.