DNZ Property is urging unhappy investors to buy out a multi-million dollar management contract owned by one of its directors.
DNZ was unsuccessful in an initial attempt to list on the sharemarket, after investors in the embattled property fund baulked at paying $43 million to buy out DNZ's management contract held by chief executive Paul Duffy and director Alastair Hasell.
However, a series of meetings to resolve the company's future has not soothed investor anger.
Attempts by DNZ Property to list and raise $140 million last year were stymied by MMG, which claims to represent the majority of its 8000 shareholders.
MMG argued the deal would result in a 40% loss in value for existing shareholders, and, along with an investor action group, is seeking seats on the board to decide DNZ's fate.
DNZ's preferred option is to list, and raise money to buy out the management contract and reduce debt.
The chairman of DNZ, Tim Storey, says the company cannot move forward unless the contract is removed.
One of DNZ's advisors, Goldman Sachs JB Were's Andrew Barclay, urged shareholders to pay up and move on, saying the company's share price on the unlisted market would not improve if they did nothing.
But investors are not happy about paying the $35 million price tag.
The portfolio manager of BT Funds, Matthew Goodson, which owns more than 1 million shares, says DNZ should raise just enough cash to cover the costs of the contract and reduce debt - about $25 million.
He says it is difficult to know what would be a fair price for the management contract.
DNZ's board says it seriously considered liquidation, but decided it was not in investors' best interests, because it could take years to sell properties at decent prices.
Shareholders will elect the two new board members at a special meeting on 12 May in Auckland.