BlackRock Latin American (BRLA), the last remaining UK investment trust dedicated to the South Americas, has raised the prospect of its demise after announcing plans to offer shareholders a 100% exit in 2030 if it does not beat its benchmark.
The four-year conditional tender offer heaps pressure on fund managers Sam Vecht and Gordon Fraser with the company yesterday also launching a 25% tender offer after the trust’s previous underperformance.
Somewhat ironically, the announcement came in results showing BRLA benefiting from a “remarkable” year for the region’s stock markets. The £124m investment trust made a 54.8% dollar return in 2025 in line with the MSCI EM Latin America index. In sterling terms, net asset value (NAV) rose by 44.2% also in line with the benchmark’s 44.1%.
Chair Carolan Dobson said Latin America stood out as a relative pocket of calm in an increasingly turbulent world. “The ongoing conflict in the Middle East has introduced meaningful uncertainty around global energy supply chains. In this environment, Latin America’s geographic and geopolitical distance from the conflict is a genuine asset. Much of the Latin America sits in the ‘neutral’ political bucket in an increasingly ‘East-West’ divide,” she said.
BlackRock data show that in the five years to 31 January, the trust made an underlying 59.2% total return, below the benchmark’s 87.2%. Shareholders did better with a 75% total return. The shares currently stand on a 5% discount to NAV.
Our view
QuotedData’s senior analyst Matthew Read said: “BlackRock Latin American is the only trust that gives pure exposure to the region but that alone is not a reason for it to exist. The board is basically saying outperform the benchmark or we’ll hand investors their money back – it is hard to imagine a situation where a 100% tender offer at FAV after another run of poor returns wouldn’t see a rush for the exit.”
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