Saba issues alternative plan to EWIT shareholders – Daily Business

Boaz Weinstein heads Saba Capital Management

Saba Capital Management, the New York hedge fund demanding changes at Edinburgh Worldwide Investment Trust, has made a revised offer to shareholders which it claims is superior to the company’s tender offer.

As the largest shareholder in EWIT, Saba says the current coard’s proposal, which would force tendering shareholders to accept untradeable tracker shares tethered to the SpaceX position, Saba’s enhanced proposal would provide shareholders a clean exit, on their own terms.

It would also be at a time of their own choosing, with no complex instruments and no illiquid securities.

“After listening carefully to shareholder feedback, we believe Saba’s enhanced proposal is significantly superior in structure and governance to the company’s proposed tender offer and is in the best interests of all shareholders,” said Saba in a statement.

“We do not believe in creating a self-manufactured urgency designed to push shareholders out the door before they have a chance to evaluate their options.”

It encourages all EWI shareholders to vote against the current board’s proposed tender offer ahead of the 8 April deadline, and to elect Saba’s three independent nominees – Gabriel Gliksberg, Michael Joseph and Jassen Trenkow – at the upcoming annual general meeting.

Meanwhile, the Financial Conduct Authority interim executive director Simon Walls has been defending the regulator after criticism from EWIT chair Jonathan Simpson-Dent and others that it trusts are being ‘short-sighted” about activist interest.

In a blog published on the FCA’s website entitled Investment trust votes, conflicts of interest, and our role, Mr Walls wrote: “There has been substantial debate over our role in relation to investment trusts, including calls for us to ‘get to grips’ with voting rules ‘that allow a minority shareholder to repeatedly attack an investment trust’.

“Much of this debate suggests there are misunderstandings about how investment trusts are governed and where responsibilities sit. We’re concerned this may confuse investors in these trusts.”

Mr Walls added some calls to action have “lacked clear proposals or been based on future hypothetical scenarios for which protections often exist.

“In recent weeks, some of the language used by boards and managers has implied that certain requisitions for votes are vexatious or not in the best interest of shareholders.”

However, James Carthew, head of investment companies at QuotedData, criticised this suggestion from the FCA, calling it a “dead end” for shutting down Saba.

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