bidders statement - counter view, page-5

Another REIT tragedy which continues to demonstrate the ineptness of our market monitors (ASX & ASIC). The fact that this offer can be made without regulatory challenge is beyond belief ... but real nonetheless.

Note : I have no holding nor interested in taking a position. I am not a lawyer ... a simple minded investor. Holders I think need to be disruptive or this will unfold exactly at 0.78... like it or not!

The following seems true to me:

1. The most recent disclosure by the responsible entity is that info included in an investor presentation released to exchange 24/2/11.
2. In that presentation NTA (presumably some measure of fair value???) was disclosed as AUD 0.106.
3. No sequel warnings or notices suggest any deterioration.
4. This then is the Responsible Entities (RE) current considered view.
5. Any deterioration of say 30 % to AUD 0.0742 would I expect attract either a 'please explain' request or onus on directors to declare.
6. Logically then any bid for less than fair value on the part of the RE must be to the benefit of the RE and not the members.
7. The RE has a statutory duty (Corp Law sec 601FC(c)) to act in interests of the members in priority to itself.
8. Evidence suggests RE not compliant and so should be reminded by ASIC of this obligation...

... the alternate conclusion must be that the RE is not acting responsibly because the value of the units has materially and it has not disclosed that to the market....

Can I suggest holders approach ASIC as to:
(a) the RE's apparent non compliance with the law and ask that ASIC consider court appointment of an alternate temporary RE ... at least that might rattle the RE into moving the offer up;
(b) Challenge ASIC to investigate the legality of EDT's holdings in the US REIT noting that neither are [I don't think managed schemes] registered in Australia. (Note sec 601FC(4) ...cannot invest in other managed investments schemes if that scheme is not registered !!!)
(c) request ASIC or the ASX to query the apparent discrepency between fair value as per the investment presentation and the value of the offer made by the RE...by definition they cannot be different!!!

Again be disruptive... but let ASIC do the work. The best holders can hope for is a price increase to at least NTA ... hell they (including me) endured the loss during GFC...

Good luck to all. Have a great day..