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Thursday, December 17, 2020 – 12:48 pm
Eagle Hospitality Reit Management (EHRM) shareholder, manager of Eagle Hospitality Real Estate Investment Trust (EH-Reit), filed an appeal on December 10 to Finance Minister Heng Swee Keat regarding the directive on its removal.
In a press release on Thursday, Mandarin West Holdings (MWH), EHRM’s sole shareholder, noted that the Singapore Monetary Authority (MAS) board dated November 30 instructed the EH-Reit manager to remove EHRM. within one month from the issuance date of the directive, or a longer period that MAS can approve in writing, and appoint a new manager for EH-Reit.
“After receiving professional advice, MWH’s position is that there are meritorious grounds for appeal with a reasonable chance of success,” the shareholder said in the statement.
“Consequently, the appeal against the MAS directive has been filed with the Minister under the Securities and Futures Law (SFA),” he added. MWH said it has “emphasized the fact that it has injected millions of dollars in additional cash into the Reit compared to the income generated by its properties during the same time period.”
Last month, MAS ordered the removal of EHRM as manager of EH-Reit. MAS also directed the DBS Trustee, in its capacity as the EH-Reit trustee, to appoint a new manager “as soon as possible.” Following the directive, SCCPRE Hospitality Reit Management was identified earlier this month as the new proposed manager for EH-Reit.
MAS’s directive follows a Notice of Intent (NOI) issued on October 26 on the removal, in light of “numerous” violations of the SFA by EHRM, as well as “serious concerns” about the manager’s ability to comply. with the rules and regulations.
MAS said it received written submissions from MWH in response to the NOI and had “considered them carefully.” However, as the written submissions did not raise “new material facts,” MAS proceeded to issue the directive to the DBS Trustee.
“MAS continues to have serious concerns with EHRM’s ability and commitment to comply with MAS rules and regulations, given the numerous violations of the SFA, including recurring and ongoing violations of capital and financial requirements,” MAS said the last month when he ordered removal.
The Business Times has reached out to MAS for comment on the latest appeal.
Trading in the stapled securities of Eagle Hospitality Trust, which comprises EH-Reit and Eagle Hospitality Business Trust, was voluntarily suspended on March 24 of this year.
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