Sherborne’s net asset value fell by 1.5% over the six months ended 30 June 2015 to a level of 104.47p. The shares were trading at a discount of 3.3% to this NAV at the end of the period but the share price had climbed by 6.3% over the first half. By contrast Electra‘s shares rose by 4.9% over this period.
Electra is Sherborne’s only investment. he difference in the returns is accounted for by fees, finance costs and expenses. Sherborne’s managers took £1.5m for the six month period.
Sherborne now holds 29.2% of Electra’s shares and convertibles that could be converted into shares with voting rights over 1.6% of the company. 29.9% is the trigger for a mandatory bid for the company however Sherborne has said that it won’t convert enough convertibles to trigger a bid. Instead it continues to say it intends to effect operational change at Electra once its representatives have been put on the Board. Sherborne have not specified what form that operational change would take and their suggestions to change Electra’s Board have been rejected by shareholders once so it is not clear to us what will happen next (although, for Sherborne’s managers, £3m a year for investing in one stock is not a bad fee while you can continue to collect it).
SIGB / ELTA : Sherborne Investors reiterates pledge not to bid for Electra