Baillie Gifford US Growth (USA) has received a significant boost in its AGM battle with Saba Capital after the three leading, independent proxy vote advisers supported its position in the crucial vote.
The £1bn investment trust said Glass Lewis, ISS and PIRC, which institutional investors use to advise them on company votes, had all recommended that shareholders vote against Saba’s resolutions 1-3 appointing its nominees to the board.
In addition, USA said the trio had also recommended shareholders vote for resolutions 4-7 at the 23 October annual general meeting to re-appoint the existing board.
QuotedData has not yet verified USA’s claim with the three firms.
USA chair Tom Burnet said: “We are very pleased to see that all three major independent voting advisers have agreed with the board’s unanimous recommendation to vote against the Saba resolutions. These experts echo the board’s concerns that Saba’s proposals are inconsistent with appropriate standards of corporate governance and signal Saba’s intent on obtaining control of the company.”
Burnet repeated his call for shareholders to make their voices heard and protect the future of their company, saying “every vote counts.”
After beating Saba’s two previous attempts to oust the board in February and September last year, USA faces its biggest challenge yet as the US activist hedge fund owns nearly 30% of the shares. It is likely to be supported by Sessa Capital, another New York hedge fund, which has a 7.7% position, and which helped Saba recently gain control of the $1.2bn ASA Gold and Precious Metals closed-end fund in the US.
You can read our USA shareholders’ guide to the AGM vote here.
Our view
Richard Williams, senior analyst at QuotedData, said: “This is a significant boost for USA’s board ahead of its showdown with Saba. Securing the backing of all three major proxy voting advisers strengthens its case considerably, particularly as their recommendations reflect concerns over corporate governance and the implications of Saba’s proposals for the trust’s independence. However, proxy adviser recommendations are not binding, and Saba’s voting power means much will depend on the participation of other shareholders, making turnout crucial if the board is to fend off the challenge.”
