June 3, 2014 / 10:13 AM / in 3 years

Australia's Westfield asks shareholders to back split for 2nd time

SYDNEY, June 3 (Reuters) - Australia’s Westfield Group , the world’s biggest retail property group, asked shareholders for a second time to back a plan to split the business along geographic lines, warning they will never again have a comparable investment opportunity if they vote against it.

The Sydney-based group, headed by Australia’s second richest person Frank Lowy, wants to put its international portfolio into a new company called Westfield Corp while combining its Australasian property and property management businesses under the name Scentre.

But some Australian shareholders have said they will vote against the plan because they fear their shares will be devalued. They have said the resulting Australasian arm would be less profitable without the international assets and would carry too much debt.

Adding to the saga, a shareholder meeting last week to vote on the split was stopped after Lowy unexpectedly said he would carry out a restructure regardless of the outcome and after the board determined it amounted to “material new information”. Lowy said he would split the company by setting up a new company which would buy up Westfield assets.

In a letter to shareholders, lodged with the Australian Securites Exchange on Tuesday, Westfield chairman Dick Warburton repeated his earlier plea for them to support the break-up saying they would be especially disadvantaged if Lowy carried out his alternate plan.

“There is unlikely to be another opportunity for Westfield (Australian shareholders) to acquire what is widely regarded as the best property management platform in Australia and New Zealand,” Warburton wrote.

The proposed alternate company would have an an “almost identical property portfolio” which would achieve superior returns, creating price risk for what remained of Westfield, he added.

Shareholders will be asked to vote for a second time on June 20. (Reporting By Byron Kaye)

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