The battle for control of four property trusts has turned into a war of words between incumbent manager, Australian Property Growth Fund (APGF) and Cyre Trilogy Group, with both sides now claiming the other is misleading investors regarding lender to Austgrowth Property Syndicate No. 23 (APS 23) – the largest of the trusts.
APGF has backed prior claims Cyre involvement in the funds could trigger a default under the fund's loan documentation, stating the lender AMP had formally advised APGF in writing that it would not consent to a change of responsible entity (RE).
Cyre Trilogy Group were quick to respond, saying APGF were embarking on another scare campaign which investors had "dismissed as nonsense".
"The lenders' only concerns are that the loan convenants continue to be met, and that the new RE is a creditable manager and has the ability to fulfil its roles for not only lenders but also investors," Cyre Trilogy directors, Peter Arnold and Rodger Bacon said.
Bacon said lenders attitudes to new REs and asset strategies were evident "when investors in a number of other syndicates voted to remove APGF in May 2011" and the banks involved continued with loan facilities.
But APGF managing director Geoff McMahon stood by APGF statements saying the group received a letter from AMP lawyers which they have no reason to question. He condemned Cyre Trilogy's involvement in APGF lending arrangements.
"From their arrogant words and actions, it appears they think they are already the new responsible entity of APGF funds," he said.
APGF also accused Cyre Trilogy of sabotaging investor relations with claims they had been successful in securing six of ten Austgrowth Trusts, rather than three in May 2011 – "a fail mark in anyone's books," according to McMahon.
He said Cyre also misled investors with claims they approached all lenders before making the "predatory bid" on APGF funds and also with statements regarding 1,000 investors who want to oust APGF as the RE.
"It was Cyre Trilogy calling the meeting using a limited number of powers of attorney," he said.
Both parties are holding out for an investor meeting to be held on 4 June, which Cyre claims investors have called to oust APGF, but APGF says investors have told them they will attend to front Cyre.
"These investors say enough is enough because it is costing them money to defend these unwanted challenges that only benefit Cyre Trilogy," McMahon said.
