Waiver from NZX Listing Rule 5.2.1

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24.03.21
NZ RegCo Decision
Precinct Properties New Zealand Limited (NS) (PCT)
Application for waiver from NZX Listing Rule 5.2.1

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Waiver from Listing Rule 5.2.1
Decision
1. Subject to the conditions set out in paragraph 2 below, and on the basis that the information
provided by Precinct Properties New Zealand Limited (NS) (PCT) is complete and accurate in all
material respects, NZX Regulation Limited (NZ RegCo) grants PCT a waiver from NZX Listing
Rule 5.2.1 (Rule), to the extent that this Rule would otherwise require PCT to obtain the approval
of shareholders to enter into a Material Transaction with Related Parties.
2. The waiver in paragraph 1 above is provided on the conditions that:
a. the directors of PCT who are not Associated Persons of the Manager (i.e. the Committee of
Independent Directors) certify that:
i) the terms of the Material Transaction have been entered into and negotiated on an arm’s
length commercial basis;

ii) entry into the Material Transaction is in the best interests of PCT and is fair and
reasonable to PCT and its shareholders who are not related to, or Associated Persons of,
the Manager; and
b. the waiver, its conditions and its implications are disclosed in PCT’s next annual report.
3. The information on which this decision is based is set out in Appendix One to this decision. This
waiver will not apply if that information is not or ceases to be full and accurate in all material
respects.
4. The Rule to which this decision relates is set out in Appendix Two to this decision.
5. Capitalised terms which have not been defined in this decision have the meanings given to them
in the Rules
Reasons
6. In coming to the decision to provide the waiver set out in paragraph 1 above, NZ RegCo has
considered that:
a. the policy of Rule 5.2.1 is to ensure that a Related Party does not exercise undue influence or
use personal connections to reach a favourable outcome for, or a transfer of value to, the
Related Party in respect of a transaction and that shareholders are given an opportunity to
review transactions where the board may have been subject to actual or perceived influence
from a Related Party;
b. PCT submits, and NZ RegCo has no reason not to accept, that these circumstances are not
applicable because:
i) all actions of PCT relating to the Transaction have been undertaken by the Committee of
Independent Directors and its advisers. ADIA, AMP, the Manager-appointee directors of
PCT, and executive officers of the Manager, have not been involved. Accordingly, the
Committee of Independent Directors considers that the terms of the Transaction were
negotiated on an arms’ length commercial basis with the Manager, ADIA and AMP (as
applicable);

ii) the Committee of Independent Directors managed the Transaction for PCT so the
Manager and its executive officers (who were appointed, and are employed by the
Manager) were not in a position to exercise undue influence over PCT’s decision to enter
into the Transaction;

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iii) the Committee of Independent Directors considers that the Transaction is in the best
interests of PCT and its non-related shareholders. PCT submits that while AMP was
conducting its portfolio review (as reported in the media), PCT, through the Committee of
Independent Directors, wished to put the strongest possible transaction forward to
AMP/ADIA (as owners of the Manager) and not requiring shareholder approvals was a
key component of delivering more execution certainty; and

iv) as the Transaction was negotiated on arm’s length terms, the terms of the Transaction
were not materially different to similar transactions entered into with non-Related Parties.
The Committee of Independent Directors’ deliberations included consideration of the
valuations undertaken by their advisers and their own judgements.
Confidentiality
7. PCT requested this decision be kept confidential until PCT releases an announcement relating to
the Transaction.
8. In accordance with Rule 9.7.2, NZ RegCo granted PCT’s request.

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Appendix One
1. PCT is a Listed Issuer with ordinary shares quoted on the NZX Main Board.
2. PCT currently operates under an external management structure pursuant to a management
agreement dated 27 September 2010 (Management Agreement) with AMP Haumi Management
Limited (Manager). The Manager employs PCT’s executive officers, as well as most other
employees in PCT’s business.
3. The Manager is a joint-venture company, owned 50/50 by Haumi Development Auckland Limited
and AMP Capital Investors International Holdings Limited (AMPCIHL) which are themselves
ultimately owned by Abu Dhabi Investment Authority (ADIA) and AMP Limited (AMP),
respectively.

4. On 30 October 2020, AMP advised the ASX and NZX that it had received an indicative, non-
binding, conditional proposal from Ares Management Corporation, a US-based company, to
acquire 100 per cent of the shares in AMP by way of scheme of arrangement.

Material Transaction with Related Parties

5. PCT subsequently established a committee comprising of only independent directors of PCT
(Committee of Independent Directors) and advisers in response to the potential corporate
activity affecting AMP and how that might impact PCT.

6. In particular, the Committee of Independent Directors engaged in discussions with ADIA and
AMP in relation to a transaction (the Transaction) that could result in:

a. PCT and/or ADIA acquiring all of AMPCIHL’s shares in the Manager; and

b. PCT internalising its management function by terminating the Management Agreement and
paying a termination fee to the Manager.

7. The Committee of Independent Directors resolved to progress the internalisation of the
Management Agreement, subject to reaching agreement with AMP/ADIA. The termination fee
payable by PCT to the Manager is expected to be at or about the value of the Management
Agreement. The gross cost of that fee will exceed 1% of PCT’s Average Market Capitalisation
(AMC), which was approximately $2.19 billion as at 23 March 2021. The money to be paid in
respect of the Termination Fee may exceed 10% of PCT’s AMC.

8. The Manager is a Related Party of PCT, as:

a. ADIA is a Related Party of PCT, as it has an indirect interest (through its subsidiary Haumi
Company Limited) in 17.737% of the shares in PCT; and

b. the Manager is an Associated Person of ADIA, as ADIA is able, directly or indirectly, to exert
a substantial degree of influence over the activities of the Manager.

9. An internalisation proposal of this nature is a transaction governed by paragraph (e) of the
definition of Material Transaction and, depending on the final amount of the Termination Fee,
paragraph (c). Therefore, Rule 5.2.1 would require PCT to seek shareholder approval for the
Transaction. Other than in respect of Rule 5.2.1 PCT is not required to seek any other
shareholder approvals for the Transaction.

PCT sought a waiver from Rule 5.2.1 to the extent that the Rule would otherwise require PCT to
obtain the approval of shareholders to enter into a Material Transaction with Related Parties.

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Appendix Two
Rule 5.2.1 Transaction with Related Parties
Rule 5.2.1 An Issuer must not enter into a Material Transaction if a Related Party is, or is likely
to become:

(a) a direct party to the Material Transaction, or

(b) a beneficiary of a guarantee or other transaction which is Material Transaction,

unless that Material Transaction is approved by an Ordinary Resolution (such
resolution being subject to the voting restrictions in Rule 6.3) or conditional on such
approval.