Board of Pacific Assets Trust insists its fund managers must make up for underperformance of the past four years to avoid a 25% tender offer in 2028, plus annual results and updates from JPMorgan Global Growth & Income, Abrdn Diversified Income & Growth, Patria Private Equity, Seraphim Space and a name change at JPMorgan Indian.
Pacific Assets Trust (PAC), the £410m Asia-focused sustainable investment company whose long-standing fund manager David Gait resigned in August, has cut the annual management charge it pays Stewart Investors and proposed a 25% tender offer in 2028 if its seven-year performance does not beat the MSCI AC Asia ex Japan index. Starting this month, the flat fee of 0.85% net assets will be replaced by a tiered fee of 0.75% up to £500m and 0.65% above that. Unusually, the conditional tender offer is already four years into its assessment period, a time over which the trust has trailed the index by over 10%, with an investment return of 9.3% versus the benchmark’s 19.9%, leaving fund managers Jack Nelson and Douglas Ledingham a lot of ground to make up. Interim results showed a 3.7% fall in asset value in the six months to 31 July, underperforming both the CPI inflation plus 6% benchmark, that required 5.5% to match, and the 9.5% gain in the MSCI AC Asia ex-Japan index, with the fund’s underweight to China weighing on the return.
Winterflood analyst Alex Trett commended the board’s “proactive approach” to the persistent discount with the shares currently 12% below net asset value.
JPMorgan Global Growth & Income (JGGI), the £3.3bn giant of the Global Equity Income trust sector, trailed its MSCI AC World benchmark in the year to 30 June with a 1% investment return that lagged the 7.2% sterling gain of the index. Shareholders saw a total loss of 1.6% with 22.8p per share of dividends included as the shares slipped from a premium to a 0.7% discount to net asset value. The underperformance was largely caused by stock selection with the fund managers’ preference for higher-quality growth stocks overtaken by lower quality value stocks in the “Trump rally” after last November’s US election. Caution about short-term prospects saw the managers remove gearing with a 0.6% net cash position at the financial year-end. In July co-manager Tim Woodhouse was replaced by Sam Witherow to work with the existing team of Helge Skibeli and James Cook. JGGI, a former sector leader, currently ranks third out of six global equity income trusts with a five-year total shareholder return of 98.8%.
JPMorgan Indian (JII) has changed its name and ticker to JPMorgan India Growth & Income (JIGI) following the adoption of a 4% enhanced dividend policy announced in May as part of measures to tackle the persistent share price discount, currently 9% below net asset value.
Rockwood Strategic (RKW) returned 12.5% in the six months to 30 September, just ahead of the £136m UK smaller companies fund’s benchmark, the FTSE Small Cap, which rose 12.1%, but below the 14.8% rebound in the FTSE AIM All Share index. A half-year trading update says the portfolio, managed by Richard Staveley and Nick Mills at Harwood Capital, benefited from a takeover approach for flavourings supplier Treatt, profits on the sale of housebuilder Galliford Try and a 53% rise in education software provider Tribal Group.
Abrdn Diversified Income & Growth (ADIG), the £143m flexible investment fund in the midst of a wind-down, has redeemed a £17m position in the Aberdeen Global Private Markets Fund at net asset value. This lifts cash to £55m enabling a further return of capital next month. Another distribution is expected in the first quarter of 2026 as the company has either received binding offers or is in advanced discussions regarding the remainder of its private markets portfolio. Conditional sale agreements have been reached with two funds run by its fund manager Patria Investments on 15 fund investments and private market assets accounting for a third of the portfolio. Patria has agreed to pay £47m for these at a price 28.5% below net asset value. The board believes it is better to sell at a discount than wait for the investments to mature up to 2033. Most remaining assets are expected to be sold at a blended discount of 30%-35% this year, which is why the shares stand 34% below NAV.
Patria Private Equity (PPET), an £823m fund of funds managed by Patria Investments, made an underlying return of 2.3% in August with net asset value per share rising 18p to 813.4p.
Seraphim Space (SSIT), a £166m growth capital fund, provides updates on several of its companies. ICEYE signed a $168m deal with Finnish Defence Forces for its SAR satellites. Spire Global won a $11.2m weather data contract with the US National Oceanic and Atmospheric Administration. Zeno Power signed a “multi-million-dollar” agreement with French nuclear manager Orano to buy nuclear waste to power Zeno’s nuclear batteries.
