By Nell Mackenzie
LONDON (Reuters) -Saba Capital Management has added more UK investment trusts to its activist campaign and plans to further shake up the sector, the hedge fund’s founder Boaz Weinstein told a London School of Economics conference on Monday.
Saba is waging a campaign to overhaul seven British investment trusts over performances it has said ranged from “underwhelming” to “disastrous”.
Weinstein on Monday said he now plans to call general meetings in four UK investment trusts to vote on whether they should transition from a closed ended structure to a comparable open-ended one, where shares can be issued and redeemed at any time.
“If investors want to stay in the investment trust, good for them, but investors should have the option,” said Weinstein.
The four funds include: CQS Natural Resources Growth & Income PLC, European Smaller Companies Trust PLC, Middlefield Canadian Income and Schroder UK Mid Cap Fund.
Richard Stone, chief executive of the Association of Investment Companies (AIC), said that Saba’s proposals on Monday marked a significant shift in strategy for the hedge fund but that more detail on how these funds would change their structure was needed.
Shareholders would remain invested in the same strategy with the same manager, but in an open ended fund, said Weinstein.
Weinstein said that since he launched his UK campaign in 2024, his campaign related fund had seen record inflows. Saba Capital Management oversees several different strategies, including activism.
With the new investor money, Weinstein said he would continue to add to his current UK activist campaign.
The trusts have publicly hit back in recent weeks, dubbing Saba’s campaign opportunistic and not in the interests of broader shareholders.
Six of the seven trusts’ shareholders have voted against Weinstein’s proposals which have ranged from buying investors out of the funds to board overhauls. The last of seven UK investment trusts targeted by Saba’s activist campaign, – Edinburgh Worldwide – votes on Friday.
(Reporting by Nell Mackenzie; Editing by Dhara Ranasinghe and Tomasz Janowski)
