Saba Capital’s Boaz Weinstein has threatened to sue the board of Edinburgh Worldwide (EWI) if it does not respond to the activist hedge fund’s questions over the partial sale of its prized holding in SpaceX.

Doubling down on criticism he made last month, Weinstein issued an open letter to the investment trust’s board, demanding answers to why the six non-executive directors allowed fund manager Baillie Gifford to reduce its stake in Elon Musk’s rocket company, its biggest holding, two months before its valuation doubled to $800bn.

Weinstein said EWI shareholders required more information on what he called a “serious misstep” that he estimated had lost the trust £37m in gains before they voted on Saba’s resolutions to remove the board on 20 January. 

Edinburgh Worldwide did not respond directly to the attack but hit back after proxy vote adviser ISS recommended its shareholders vote against Saba.

Jonathan Simpson-Dent, chair of the £773m investment trust, said: “For a second time within a year, independent voting adviser ISS has recommended that shareholders vote against all of Saba’s resolutions. Shareholders should not be swayed by Saba misrepresenting the facts, ignoring the significant progress made following the implementation of the path for growth strategy and remaining silent on their ultimate objectives.”

In his letter, Weinstein repeated his accusation that the board had put the interests of Baillie Gifford ahead of EWI shareholders by allowing the trust’s 13% weighting to SpaceX to be cut to 8.4% in October.

He said this was to enable a merger with Baillie Gifford US Growth (USA), which would have helped Baillie Gifford avoid the loss of EWI’s assets if, as he implied, Saba succeeds in gaining control of the trust at the extraordinary general meeting in two weeks’ time. 

USA also cut its position from 11.5% to 5.9% in October, a move that Weinstein said ensured a merger with EWI would not have run foul of UK tax rules with the enlarged trust having more than 20% of its assets in one company.

EWI remains under some pressure to say more about the SpaceX sale. Winterflood analyst Emma Bird saying it was “a potential concern”, adding, “however, we await the board’s response to Saba’s questions, which may well refute this claim.”

Baillie Gifford sold too low

The Saba founder and chief investment officer, whose firm holds 30% of EWI and blocked the proposed merger last month, said it was widely known that SpaceX typically runs “liquidity events” for staff to sell shares in the private company twice a year, most often in December. 

“It is reasonable to expect that Baillie Gifford would have known that SpaceX would be conducting a revaluation in December 2025. However, instead of waiting for the revaluation, Baillie Gifford sold a substantial portion of EWI and USA’s stakes in SpaceX in October 2025 – at a valuation that appears to have been materially below the December valuation.”

He also accused EWI’s chair Jonathan Simpson-Dent of acting in self interest as he would likely have joined the board of the enlarged fund if the transaction with USA had gone ahead.

This is Saba’s latest attempt to damage Simpson-Dent’s credibility. In a presentation released at the end of December it highlighted his previous role as chief finance officer at Homeserve, the insurance intermediary that was fined £30.6m in 2014 for a mis-selling scandal from 2005-2011. However, Simpson-Dent only worked at the company for two years up to June 2009.

War of words

Weinstein claimed that other EWI shareholders were “deeply troubled” as he asked:

• at what valuation did Baillie Gifford sell SpaceX in October and to whom?
• why did EWI not communicate the sell-down to the market?
• did Baillie Gifford or the EWI board know a SpaceX revaluation was imminent?
• was smoothing the proposed merger with USA a factor in the sale? 
• did Baillie Gifford consult with the board before the sale of SpaceX?
• when was the merger between EWI and USA first proposed and when did Baillie Gifford become aware of it?
• did Simpson-Dent and USA chair Tom Burnet use “disappearing WhatsApp messages” to discuss the merger and the decision to sell down SpaceX?

“Unless and until we receive satisfactory responses to these questions and concerns, we reserve all of our rights, including to issue proceedings on behalf of EWI,” Weinstein concluded.

Edinburgh Worldwide has demanded its own questions of Saba, saying the firm should be more transparent about its plans for the trust and whether it wants to be appointed fund manager. That was Saba’s plan a year ago when shareholders overwhelmingly rejected its previous attempt to oust the board.

“If shareholders want to prevent this US hedge fund from taking control of the company on the cheap, it is critical that they vote against all of Saba’s resolutions before the opportunity for doing so closes for many next week,” said Simpson-Dent.

“We strongly encourage shareholders not to be complacent and remind everyone that Saba holds a larger shareholding and therefore more voting power this time. Shareholders must turn out in force in order to prevent Saba from taking control,” he added.

EWI fears Saba could succeed in taking control through its three director nominees if turnout at the vote is low. It says if Baillie Gifford were sacked as fund manager, shareholders would lose a “unique and distinctive portfolio of disruptive and transformative companies positioned for long-term growth”.

This includes the holding in SpaceX which jumped £56m in value last month on the revaluation, lifting it to 15.9% of the portfolio. USA and two other Baillie Gifford trusts benefited from this, most notably the flagship Scottish Mortgage which saw its net asset value jump £1bn as a result.

Both sides reminded shareholders the deadline to vote through stockbroking platforms could be as early as 12 January. Simpson-Dent is holding an online Q&A session for shareholders on Friday to present the trust’s case. Saba says the EWI board needs to be held to account for shareholders’ 38% loss over five years under Baillie Gifford. Over one and 10 years the shares have returned 11.5% and 144% respectively. The shares gained a further 1.2% to 225.7p this morning.

Our view

Matthew Read, senior analyst at QuotedData, said: “We were a little surprised by Saba’s open letter to Edinburgh Worldwide’s board this morning as Saba has already made clear its objection to the reduction of EWI’s and Baillie Gifford USA’s positions in SpaceX, so this doesn’t feel like new information.

“It is a distraction from the board’s legitimate demand to know what Saba plans to do with EWI if it gains control of the board, which we feel other EWI shareholders should know about before the vote.

“However, it does support the argument that Saba’s primary interest in both trusts stems from a desire to get control of their SpaceX investments.

“We expect the war of words will continue up until the vote. We think that shareholders should follow developments closely, get themselves informed about Saba’s proposals, and make sure they vote as the outcome will have significant implications for their investment in EWI.”