Aquila Energy Efficiency (AEET), the £37m renewable energy fund approaching the fourth year of its wind-down, has terminated the management contract of Aquila Capital with no payment in lieu but will retain fund managers Alex Betts and Franco Hauri as consultants as the now self-managed company looks to dispose of the rest of its assets. Betts and Hauri, who will operate through Truenorth Value Partners, will receive a base fee of £550,000 a year for the first 18 months, reducing to £300,000 once either the number of portfolio assets falls to five or net asset value (NAV) declines to £5m. They will be incentivised to speed up the process of returning shareholders’ capital. Once £15m of disposals have been made, they will also be paid a performance fee on each subsequent disposal ranging from 1% if the price is below 80% of NAV up to 2% if sold more than 90% of NAV. AEET shares rose 3.9% to 23.9p, slightly narrowing the 50% discount at which they stood on Friday.
QuotedData senior analyst Matthew Read said: “The move to a self-managed structure at Aquila Energy Efficiency Trust looks like a sensible evolution as the wind-down progresses. With the portfolio shrinking, shifting costs away from a traditional percentage-of-assets model and onto a more fixed-cost basis should help improve alignment and give shareholders greater visibility over what they are paying during the realisation process. Retaining the two individuals most closely involved with the assets also offers welcome continuity for what is clearly a complex portfolio. Where we are less convinced is on the performance fee structure. In our view, incentive fees during a managed wind-down should be reserved for genuinely value-enhancing outcomes – namely disposals above their carrying value in the NAV. Paying performance fees on sales achieved below NAV risks rewarding asset sales that simply crystallise discounts rather than create value for shareholders. On that basis, these arrangements look too generous.”
BlackRock Throgmorton (THRG), the £414m UK small-cap trust merging with stable mate BlackRock Smaller Companies (BRSC), says its 38% cash exit offer was over-subscribed with applications from 51.9% of shares. The 62% of shares rolling over will be reclassified this Wednesday with trading in the new BRSC shares starting on Friday 17 April.
Abrdn European Logistics Income (ASLI) has warned it may take time to sell its last property as the war in the Middle East weighs on investor sentiment. Since announcing the sale of a warehouse near Avignon, France, on 20 March, one of its two remaining assets from the 27 with which it started in June 2024, has also gone under offer. In reference to the sole asset, it said: “While the sales process had been progressing, momentum has slowed in recent weeks amid heightened geopolitical uncertainty, including the situation involving Iran, and broader macroeconomic concerns, which may continue to affect buyer confidence and transaction timetables for larger asset purchases.” In the fourth quarter of last year, net asset value (NAV ) including provision for disposal and liquidation costs fell to €32.6 cents (28.4p) from €48.2c (42.1p) at 30 September. This does not include a potential 1.2p per share capital gains tax liability. The shares dropped 2.4p, or 8.6%, to 25.4p.
Sirius Real Estate (SRE) has withdrawn from the purchase of the second of two German defence properties for which it raised £77m in February, after the seller hiked its asking price. In its place it has identified two alternative assets worth €30m, one of which is defence related, on which it expects to complete in the second quarter. The new purchases should result in a better blended yield than the 7.6% that the other asset and the €93.4m acquisition of the Kiel business park made last month, where defence giant Rheinmetall is the lead tenant, would have produced. In a trading up for the year to 31 March, the Anglo-German business park investor said like for like rent roll had grown 6.4% after an acceleration in the second half of the year. The results will be published on 1 June.
Harwood Capital’s Rockwood Strategic (RKW) has taken a stake of just over 3% in AIM-listed music equipment specialist Focusrite (TUNE) a month after the founder and executive chair Phil Dudderidge, a former Led Zeppelin roadie, stepped down with the shares close to a 10-year low, the Times reported. The holding was disclosed by RKW, a £156m UK smaller companies investment trust managed by Richard Staveley, last Wednesday.
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