The Pacific First Mortgage Fund's (PFMF) investment manager, Balmain Trilogy, said it has failed to win enough support to fully implement a new strategy for the fund.
At a unitholders' meeting in Brisbane yesterday, Balmain Trilogy fell short of the 75 per cent unit value threshold needed to fully implement its proposed new strategy for the fund.
"Clearly, there was strong support for the new strategy, but it was hijacked by a small number of unitholders and others who waged a campaign of misinformation," the fund's joint chief executives, Rodger Bacon and Andrew Griffin, said in a statement.
The resolutions proposed at the meeting included changes to the redemptions program and a reduction in the manager's fee from 1.5 per cent of gross assets to 1.25 per cent of net assets of the fund.
Griffin said the results of the meeting would mean hardship payments cannot be made under PFMF's current constitution because a current unit price cannot be struck.
"The management fee will remain at 1.5 per cent and the opportunity to cut it to 1 per cent and introduce a performance fee that was aligned to how the fund performed would not proceed," he said.
"Unitholders will be denied the option to leave the fund early and will have to wait until payments are made."
Unitholders who wanted to stay in the fund would also be forced to take payments.
However, Balmain Trilogy confirmed that the payment of $35 million promised to unitholders in October would be made.
"The remainder of the payments program - a total of $295 million by October 2012 - would also proceed as promised," the firm said.
