Shareholders veto £1.6bn property fund merger

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The controversial merger of two of Britain's biggest property investment funds was called off last night after independent shareholders narrowly voted to block the deal.

UK Commercial Property Trust, which is managed by Ignis Asset Management, had hoped to take over the Foreign & Colonial Commercial Property Trust in a deal that would have created the UK's sixth-largest property company with assets of £1.6bn.

However, shareholders representing 50.07 per cent of the trust's investors said no to the deal, despite it having been approved by the independent boards of both companies in June.

The no vote will be seen a victory for F&C Asset Management, which has campaigned against the merger on the grounds that the trust it manages has been a strong performer.

The trust's board said it would now consider its options.