by Susan Edmunds
LMIM has been in voluntary administration since March.
FTI Consulting was initially called in as administrators but a court ruled there were too many conflicts of interest between it and LM for it to continue in that role for the Managed Performance Fund and appointed Korda Mentha instead.
Trilogy says the same must apply for the mortgage fund and believes it has the support of investors to take over as responsible entity.
“A new independent RE can manage down the loan book/security assets over time with the view to maximising recovery… a receivership winding up will negatively impact property valuations and sales and expose the income fund to multiple layers of fees.”
Trilogy is already the RE of the wholesale fund.
If the Supreme Court rules in its favour on July 15, a meeting of unitholders will have to be called within 90 days.
The court date was initially scheduled for May 13. LMIM wants to wind up the fund.
LMIM has called a meeting of unitholders for May 30, without consultation with Trilogy. Trilogy told advisers on Friday that the meeting had been invalidly called and has asked for more information.
It said due to court delays, the Australian watchdog ASIC was suggesting a receiver be appointed without unitholders’ input. “This would possibly result in three fees, namely the RE, ASIC receiver’s fee and Deutsche Bank’s receiver’s fee.”
The First Mortgage Fund has been frozen since 2009 with $100 million of 2750 New Zealand investors’ money inside it.
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