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LMS Capital votes to remove Gresham House

LMS Capital votes to remove Gresham House – at the meeting called to decide who should be running LMS Capital, the votes were 41.6% in favour of keeping Gresham House as manager and 58.4% in favour of internalising the management of the company. The independent directors (who wanted to keep Gresham) have resigned. The vote was swung by interests aligned with the Rayne family – 32.6m of the 40.1m shares voted in favour of the internalising management idea.

Nick Friedlos, James Wilson, Peter Harvey and Graham Stedman have been appointed as new directors. Notice has been served on Gresham, which will expire in May 2020. A special dividend of 4.5p is being declared.

Robert Rayne said “It is my firm view that a return to an internally managed business model is in the best interests of all Shareholders. I am, therefore, delighted that LMS will be returning to the active management of our investments. I am also delighted to welcome, as part of the return to internal management, our highly experienced team of directors to the board.”

[The shareholders’ decision is all above board but it seems unfair to us to trap the independent shareholders, who overwhelmingly rejected this move, within the company. The best course of action might be to offer a substantial tender offer at a price close to NAV and then seek to persuade investors of the merits of the investment proposition.]

LMS Capital votes to remove Gresham House

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