YieldReport readers may remember our recent coverage of the ongoing dispute between PaperlinX and a group of holders of PaperlinX hybrids (PXUPA). PaperlinX wanted to make a conditional off-market scrip offer for its hybrid securities but a group of PXUPA unitholders requested that a general meeting be held to consider a special resolution to amend the constitution of the PaperlinX SPS Trust. On 4 November the Trust received a second request to make a change to the constitution that would vary the rights attaching to both the PaperlinX step-up preference securities and the ordinary unit in the Trust. Such a change would have to be approved as a special resolution at three different meetings held in early- to mid-December 2013.
Two days later PaperlinX responded to the proposal stating, “This series of proposed amendments from a minority group of hybrid unit holders continues to incur costs for, and disruption to, the trust and the company. Furthermore, these proposed amendments do not offer constructive solutions to the issues facing the trust and the company and demonstrates the complexity and lack of understanding surrounding the relationship between the hybrids and PaperlinX. The company’s offer to hybrid unit holders seeks to address this complexity, whereas the New Resolution creates further confusion for all PaperlinX stakeholders.”
There appears to be no immediate prospect of an amicable solution to the differences between the company and hybrid holders.