Home Reit receives six bids as Bluestar deadline looms

Board expects to progress with an investment adviser appointment in the coming weeks

Home Reit has received proposals from six candidates to take over as the firm’s investment adviser.

In an announcement to the stock exchange, the trust’s board said it was reviewing all options and expects to make an appointment “in the coming weeks”.

It is also giving ‘particular consideration’ to selling a small amount of its portfolio in order to stabilise the firm’s other holdings.

The trust has also repaid £30m to its lender to reduce its outstanding debt to £220m.

Home Reit’s leadership have received an initial draft from forensic accountancy firm Alvarez & Marsal on its investigation into allegations of wrongdoing in property deals made by the trust.

At the end of January, it emerged that property deals made by Home Reit were to be examined by the National Crime Agency amid allegations of wrongdoing. In response, Home Reit had instructed Alvarez & Marsal to investigate.

The board said: “This is an extensive and complex report which the board is reviewing with its advisers and the report currently remains subject to certain clarifications and finalisation. An announcement regarding its key findings will be made as soon as practicable.”

Months of uncertainty

The future of the trust remains uncertain after it was removed from FTSE Indices at the end of February following the suspension of its shares at the beginning of January.

Home Reit received an unsolicited takeover approach from Bluestar in February, with the firm having until 13 April to either lodge an official offer or walk away.

The trust first came under scrutiny during the final months of 2022 over concerns regarding its viability and investments.

It faced allegations from Viceroy Research in November, which accused the firm of investing in “bad assets”.

In December, law firm Harcus Parker launched a compensation claim on behalf of Home Reit shareholders, who alleged the firm had not followed its original investment philosophy while suffering significant losses.

The trust rejected the allegations, and said it would undertake enhanced auditing procedures in a bid to reassure shareholders.

As a result of these procedures, Home Reit was unable to publish its annual results within the four-month window required by the Financial Conduct Authority, leading to the suspension of its shares.

See also: RM Funds bids to become Home Reit investment adviser

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