A MINORITY shareholder in Treasury China Trust (TCT) has written a letter to Singapore’s Business Times newspaper calling for an investigation by the Singapore stock exchange (SGX) into the way the property company is run.

Of particular concern to investor Mano Sabnani was his belief that shareholders of TCT’s trustee-manager, Treasury Holdings Real Estate Pte Ltd, have too much power in the company, and not the directors of TCT or its unit-holders.

TCT listed in Singapore in June 2010 and has substantial real estate holdings in China but has headquarters in Singapore.

“Recent developments at SGX-listed business trust TCT raise several questions which are as yet unanswered,” Mr Sabnani wrote to the newspaper.

Treasury Holdings directors Richard Barrett and Johnny Ronan hold a 30 per cent stake in TCT. Treasury Holdings itself holds no units in TCT, although it is allowed to request units in lieu of cash for management fees, opening the possibility of it holding units at some time in the future.

Mr Sabnani noted how Goldman Sachs had been appointed by the trustee-manager to advise on closing the gap between net asset value per unit and the trading price of the TCT units. While Goldman Sachs reported its findings to the board, nothing had been made public, he wrote.

Instead, the trustee-manager’s ultimate controlling shareholder, Mr Barrett, announced to the stock exchange that all the directors of the trustee-manager had stepped down on July 25th.

A day later, he reappointed himself, chief executive Richard David and two other directors, Mr Sabnani wrote.

“What did Goldman Sachs have to say about how the SGX-listed business trust is being run, with its high management fees and complete control exercised by the trustee-manager?” Mr Sabnani wrote.

“At present, the trustee-manager can only be removed or dismissed with a 75 per cent vote by unit-holders; Richard Barrett and John Ronan currently control about 30 per cent of the TCT units and they are allowed to vote on any resolution to remove the trustee-manager, which they own,” he said.

The letter also complained about how three independent directors, including Raymond Horney and Jen Shek Voon, were dropped and replaced by two others, including Hu Sitao, whom Mr Sabnani said the trustee-manager had decided to appoint as the lead independent director despite his past business relationships with the group.

“I believe proper corporate governance would require that the directors of the trustee-manager be appointed by the unit-holders, and dismissed by them, by a simple majority of votes cast,” he said.

In a response to the letter, the directors of the trustee-manager said they had noted Mr Sabnani’s concerns.

“First and foremost, the trustee-manager wishes to assure all unit-holders of TCT that in the discharge of its duties as the trustee-manager of TCT, it has always acted, and will continue to act, in the best interests of all unit-holders of TCT as a whole,” they said in a statement.

The Goldman Sachs report was presently under review, they said. The board had received letters from the former directors saying they disagreed with “certain information stated in the announcements released in connection with their vacation of office as directors of the trustee-manager”.

There had been no intention to keep this from unit-holders, it said.