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Investment trust insider on Majedie

Investment Trust Insider on Perpetual Income and Growth

Investment trust insider on Majedie – James Carthew: Majedie’s RCP-style rejig shows promise

Majedie Investments (MAJE) has had another rethink about its strategic direction and now proposes to appoint a new fund manager and adopt an investment approach that targets returns of inflation (UK CPI) plus 4% per annum averaged over five years.

The £95m global equity income trust used to command a much bigger market value; its share price discount has been a lot narrower than the current 22% level; and there have even been times when it wasn’t the worst-performing fund in its peer group by some distance, currently – something needed to change.

I last wrote about MAJE in February and back then my message was that the investment trust needed to fight hard to justify its existence and perhaps it should look for a merger partner. However, it hopes to have one more go at turning itself into a closed-end fund that investors will support.

The new manager is Marylebone Partners, which you are unlikely to have heard of as it has just $400m of assets under management. However, the investment management team has a good pedigree – the lead fund manager Dan Higgins is ex-Fauchier Partners and Mercury Asset Management, for example. It also has a good three-year track record in the approach that MAJE wants to adopt. Majedie will be given a 7.5% stake in the partnership as part of the deal.

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