<\/p>\n
Boaz Weinstein: real choice<\/p>\n
Saba Capital Management has secured another victory in its battle over shareholder value with a series of UK investment trusts.<\/p>\n
The largest shareholder in Herald Investment Trust has instigated a tender offer which will allow shareholders in the trust to reduce their holdings at close to the net asset value per share. <\/p>\n
Saba has agreed to a full exit and a three-year standstill agreement during which it will not seek to change the composition of the board, nor seek to control or influence the board or company or the policies or management of the company.<\/p>\n
Herald\u2019s management contract is being transferred from Herald Investment Management Limited to Aberdeen Investments along with the investment team led by founder Katie Potts.<\/p>\n
The agreement follows the bitter battle between Saba and Edinburgh Worldwide Investment Trust which resulted in five members of the trust\u2019s board being ousted. A sixth was already retiring.<\/p>\n
The New York based hedge fund described the HIT agreement as a \u201clandmark outcome\u201d for its shareholders. The deal will involve a tender offer for up to 66% of its issued share capital.\u00a0<\/p>\n
HIT marks the sixth UK investment trust of Saba\u2019s seven original campaigns launched in December 2024 where its engagement has resulted in a material liquidity or governance outcome for shareholders.<\/p>\n
Boaz Weinstein, founder and chief investment officer at Saba, said: \u201cSix successful outcomes from our seven original UK campaigns \u2014 that record speaks for itself. <\/p>\n
\u201cShareholders will now have real choice: immediate liquidity close to NAV, or continued exposure to the same strategy they believe in under a stronger institutional platform. <\/p>\n
\u201cThis is what shareholder engagement looks like when boards act in the interests of the people they serve, and it is what Saba will keep demanding across the UK investment trust sector.\u201d<\/p>\n
Ms Potts said: \u201cHerald has delivered a clear and successful investment strategy since 1994, and this disciplined approach will remain unchanged with Aberdeen, who I look forward to joining.<\/p>\n
\u201cOur focus remains firmly on the technology and communications sectors, which continue to benefit from exceptional innovation and strong long-term growth prospects. HIML is pleased to report that the share price and NAV per share of HIML\u2019s investment trust and fund are at record levels.<\/p>\n
\u201cLooking ahead, we will benefit from Aberdeen\u2019s enhanced marketing reach and will endeavour to continue to deliver above average returns for shareholders.\u201d<\/p>\n
Dan Coatsworth, head of markets at AJ Bell, says: \u201cHerald Investment Trust lives to fight another day. After considerable disruption from activist investor Saba, Herald has struck a deal that will see it reborn under the care of asset manager Aberdeen.<\/p>\n
\u201cFund manager Katie Potts will move over to Aberdeen, and Herald will conduct a tender offer for up to 66% of its issued share capital, effectively providing Saba with an exit close to net asset value.<\/p>\n
\u201cSaba has agreed to stop any further meddling with Herald for three years and the same for a further eight investment trusts managed by Aberdeen.<\/p>\n
\u201cBoth sides appear to be declaring victory, which is slightly odd. Herald says it has secured its future, while Saba says it has now won six campaigns against UK investment trusts.<\/p>\n
\u201cWhile both sides have got something they want, it still feels like a compromise. Herald continues to operate, but risks giving up some of its assets. Saba bought cheaply and can sell a chunk at fair value, yet the standstill agreement means it is effectively silenced as an activist by Aberdeen.<\/p>\n
\u201cThe investment trust industry has been tearing its hair out over the activist\u2019s meddling and might think the Herald outcome is the blueprint to follow if it means Saba can eventually go away.\u201d<\/p>\n
\t #Sixth #Saba #victory #Aberdeen #takes #HIT #mandate #Daily #Business<\/p>\n","protected":false},"excerpt":{"rendered":"
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