US-based hedge fund QVT Financial LP has strongly opposed Hirco Plc’s proposal to merge two Indian subsidiaries of the Hiranandani group with itself. QVT holds a minority stake in Hirco, a real estate fund floated by the Mumbai-based developer Hiranandani group in the Alternative Investment Market (AIM) of London.

Hirco has called an extra-ordinary general meeting on January 16 in Mumbai to seek the shareholders nod for the proposed merger.

According to a statement issued by QVT, the fund believes that the move is economically damaging to the shareholders of Hirco and favourable to the Hiranandani group. QVT has urged the Hirco shareholders to vote against the resolutions, proposing the merger.

QVT said in the statement that the Hiranandani group would stand to reap financial windfall and would scale up its holding in Hirco by the proposed merger.

It is also troubled that the timing and remote location of the EGM may disenfranchise shareholders, the statement said.