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AIMS wins case against TFML

By Wouter Klijn

AIMS Funds Management has won a long-running court case against the responsible entity (RE) of a managed investment scheme now known as P-REIT.

 After a High Court judgment in favour of AIMS, the fund manager was awarded more than $10.8 million plus interest plus the costs of the trial to be paid by the RE of P-REIT, TFML Limited.

 AIMS has calculated the interest on the judgment against TFML as more than $4.6 million.

“This amount plus the judgment debt, which excludes the RE’s legal cost of the litigation, is equal to approximately 3.3 cents per unit,” AIMS said yesterday in a statement to the Australian Securities Exchange.

“As a result, the fund’s unaudited net tangible asset (NTA) is approximately 16.3 cents per unit."

 The case centred on the redemption of units by the RE of P-REIT, which originally was Zhaofeng, but was replaced in May 2012 by TFML.

 MacarthurCook, which AIMS acquired in 2009, subscribed for 15 million units at $1.00 in the managed investment scheme.

 In an agreement with Zhaofeng, the units were to be redeemed at issue price by the RE after 12 months.

 But by the end of the 12-month redemption period, Zhaofeng did not redeem any of MacarthurCook's units. Zhaofeng also did not purchase any of the units MacarthurCook still held.

 In August 2012, the Supreme Court of New South Wales already awarded the RE, which was still MacarthurCook Fund Management at the time, $17.8 million including pre-judgment interest.

 NTA for the fund then stood at 14.62 cents per unit, excluding the amount awarded to the RE.

 AIMS also announced yesterday that it would pay out an income distribution to shareholders.

“The board of the RE is pleased to inform unitholders in the fund that it intends to pay out annualised income distributions to unitholders in the fund that is equivalent to 80 per cent of the fund’s net operating income on a quarterly basis,” AIMS said.

 AIMS Funds Management Group is a specialist in the investment management of direct property, real estate securities and mortgage assets.

 The company also has a joint venture with AMP Capital for investments in industrial real estate, called AIMS AMP Capital Industrial REIT Management.