Gore Street Energy Storage (GSF) has confirmed it made additional payments of over £5m in the past two financial years to its fund manager but denied these fees for essential services had not been properly disclosed.
In a statement to the stock exchange the international battery fund said it wanted to correct “inaccurate and misleading claims regarding the company’s investment and commercial management payments to Gore Street Capital Group”.
This follows concerns raised by rebel shareholder RM Funds that additional annual payments – estimated by Investec analysts at around £5m – to Gore Street Capital had not been communicated to shareholders.
GSF denies this saying it published details of its commercial management agreement with Gore Street Capital in a stock exchange announcement on 10 March 2022, which we reported.
The company said it complied with all its reporting obligations which were audited by EY and was confident that all disclosures were properly made. It added, “however, the company will regularly update these going forward to ensure full transparency”.
Stifel analyst Will Crighton interpreted this as an admission that the company was wrong to have stated its commercial services fees as £606,000 in the latest annual report. “While there might not be a requirement from the auditor to disclose the aggregate fee paid, given it is a related party fee, we think it still represents a lack of transparency,” he said.
Today’s statement reveals GSF paid Gore Street Capital £5.4m in 2023/24 and £5.2m in 2024/25 for construction, operational and administrative services.
These were on top of the investment management agreement under which Gore Street Capital was also paid £5.5m and £5.1m in the two financial years for running the portfolio of battery installations in the UK, Ireland and the US.
These investment management fees have recently been cut by around 22% so that from October the company pays 1% of the average of its market capitalisation and adjusted net asset value (NAV). The company estimates this will save £1.1m this financial year.
It said the separate commercial management fees were capped at the lower of cost plus 15% or 1% of NAV.
“These services if not provided by GSC would be procured from other providers, and as outlined, the agreements with GSC are regularly assessed to ensure value for money,” it said.
The company also highlighted the £93,737 payment to Gore Street Capital disclosed in its 2025 annual report for GSF’s use of the fund manager’s energy trading optimisation software. It said this was regularly reviewed and, according to this month’s NAV statement, was continuing to outperform the Modo industry benchmark.
In early trading, GSF shares rose 2.7%, or 1.4p, to 52.3p, a 50% discount to their net asset value of 102.8p at 30 June.
The poor performance of the shares in the past three years led RM Funds to challenge the GSF board at its annual general meeting this month and an extraordinary general meeting in August. At the AGM 18%-27% of votes were cast against the reappointment of chair Patrick Cox, senior independent director Caroline Banszky and its other non-executive directors.
