Investment trust insider on Saba – Carthew: My objections to Saba’s plan and approach
Our columnist says he is far from convinced by Saba’s activist campaign against seven trusts, many of which could see incipient recoveries frustrated.
US arbitrageur Saba Capital has been investing in the UK investment companies market for a while now. It first came to my attention in June 2021, when it took a significant stake of more than 25% in Crystal Amber (CRS) and blocked a continuation resolution that needed 75% of shares voted to be approved.
Then in November 2023, it tried to insist that the size of European Opportunities’ (EOT) planned tender offer be increased from 25% to 50% of its issued share capital, but the board rejected the idea.
Over 2024, we could see it climbing up the registers on a number of trusts, but Saba did not make it clear what it was up to. The mystery was solved on 18 December, when Saba announced it was seeking to replace all directors on the boards of seven trusts with its own appointees.
Saba has been quite transparent about its plans it has seized control of these companies. It wants to sack the managers and get itself appointed in their stead, knock the trusts together into a single vehicle, and use the new entity to attack other London-listed trusts. Along the way, it says all shareholders will have the opportunity to receive substantial liquidity and exit near net asset value (NAV), if they wish.
Saba suggests…. read more here