Montanaro European Smaller Companies (MTE), the £239m investment trust run by George Cooke and Stefan Fischerfeier at Montanaro Asset Management (MAM), saw 20.5% of its shares put up for sale in the 5% tender offer announced last month.
Winterflood analyst Emma Bird said the level of over-subscription for the first semi-annual tender suggested a lack of investor demand that may require further board action “if the vehicle continues to shrink through share buybacks and tender offers”.
Shareholders who applied to sell more than 5% of their holdings will have 13.5% of their excess sold. The shares will be sold at a 5% discount to net asset value and money paid to shareholders on 5 December.
MTE stands on an 8% discount. Activist Saba Capital and US value investor Allspring had both disclosed 5% holdings in June. MAM lifted its stake from 8% to 9% last month.
Shares in the trust have advanced 21.8% in the past year but lag rivals JPMorgan European Discovery (JEDT) and European Smaller Companies Trust (ESCT). Over five years these have delivered 40.2% and 70.2% against MTE’s 15.4% total return. The trust has done better over 10 years, returning 241.8% versus 160.9% and 254.9% respectively for JEDT and ESCT.
