The proposed merger between F&C Commercial Property Trust (FCPT) and the UK Commercial Property Trust (UKCPT) has run into trouble. This is even after the merger has the backing of Friends Provident and Phoenix, the largest shareholders.

But after the merger, the Company will lose a lucrative management contract. It was confirmed by the Company, in a filing to the stock exchange. It agreed that it was very disappointed with the news and would be working on developing alternative agreements. It stressed that the alternative proposal will be in the interests of all the stake holders and will be take place in the coming days.

Experts feel that the process of negotiating alternative proposals has already started and shareholders are also expected to support these proposals. The Companies also confirmed that talks to create alternative arrangements have also been initiated.    

It was revealed in April that Friends Provident has sold a 16% stake in F&C Commercial Property Trust (FCPT) to Phoenix. Phoenix owns 63% of the stake in the UK Commercial Property Trust (UKCPT).

Both the Companies had stressed that the merger will help their shareholders, improve liquidity and also increase their valuation, apart from offering benefits to both of them.

Experts also feel that a merger will benefit both these Companies and help them to increase their position in the market.