CROMWELL Property Group … its Ordeal with a very persistent Chinese Property Developer/Raider seeking Acquisition of Strategic Assets

Chinese billionaire and former windsurfer Gordon Tang (left).

Chinese billionaire and former windsurfer Gordon Tang (left).


 IT would appear this is a prime example of why the Treasurer was motivated in late march by fears of Chinese companies taking over Australian businesses and reduced the threshold to zero for all bids

-these emergency changes will expire on 1 January when the new permanent changes will apply

WHEN one reads the report by Sarah Danckert, ‘The Chinese property billionaire eyeing Cromwell, the owner of sensitive Canberra assets‘ it is difficult to fathom how it is that the Takeovers Panel considers there is ‘no smoking gun’ evidence … despite the long list of events listed below:

 –a coup to unseat the chairman of Cromwell Property Group and supplant him with corporate raider Gary Weiss, a representative of Cromwell’s largest shareholder, ARA occurred in Autumn 2020

-everyone except Gordon Tang viewed the extraordinary general meeting; Tang has large holdings in China’s property companies, in Singapore and the United States

his closest connections include members of the Bush political dynasty

-his property portfolio in Australia is now being probed

-the Tangs are seeking control of a $2.1B real estate trust 

-* at risk a building in Canberra that houses the TGA, a 49% share in a building where the Dept of Defence is housed; and Qantas’ global headquarters near Sydney airport 

-the move appears to be ARA together with Tang to make a takeover offer without a full offer; pay other shareholders a premium; described as a ‘takeover by stealth’ 

-the Tangs have a $825M interest in Singapore listed Suntec REIT managed by ARA; SingHaiyi invests in ARA fund III and an ARA trust

-the Tangs gained an 8.8% interest in Cromwell in December 2017; now more than 13%  

-mid 2019 Cromwell excluded ARA with a $375M institutional placement which led to David Blight, the MD of ARA to leave the Cromwell board

-* ARA again pushed for shareholders to vote against a resolution to approve the placement; and to vote corporate raider Gary Weiss onto the board at Cromwell’s annual meeting in November

-although the Tangs grip was growing ARA did not succeed in its bid to have shareholders veto the placement, and have Weiss on the board 

-December 2019 Cromwell sought the Takeovers Panel declare ARA and the Tangs were acting together; controlling 37.4% combined stake yet not disclosing a takeover offer as required under Australian laws

-the panel threw the case out based on a lack of evidence

-March 2020 ARA attempted to install Weiss on the board; reinforcing Cromwell’s concerns about the Tangs and ARA

ARA again lost when Tang family holdings custodians failed to vote all the family’s shares in favour of ARA’s resolution

Weiss in response said that Cromwell continued to oppose his election to the board; why was Cromwell opposing appointment of its largest owner’s representative

-the Tangs reject claims they are working in concert with ARA

-Cromwell’s gearing remains at 40% within its stated 30 to 40% target range; that it was triaging risk across its European assets including in Poland; it has $670M in combined cash and undrawn facilities

-a company spokesman said the attacks on Cromwell were “particularly galling” given the relative performance of ARA’s own vehicles

-that ARA continues to agitate and attempt to destabilise even after Cromwell security holders have rejected their attempts to control Cromwell without paying a premium twice in the last six months

-Cromwell has offered to discuss a way forward; but these offers have not been accepted by ARA

-ARA has rejected further meetings with Cromwell until their nominee, Weiss is appointed to the board of Cromwell

READ MORE!   ‘The Chinese Property Billionaire eyeing Cromwell the Owner of Sensitive Canberra Assets’

Corporate raider Gary Weiss has twice been denied a seat on the Cromwell Property Group board.

Corporate raider Gary Weiss has twice been denied a seat on the Cromwell Property Group board.CREDIT:JESSICA HROMAS