Baillie Gifford US Growth Trust has survived the third attempt by activist hedge fund Saba Capital to oust its board.
Shareholders quashed the efforts of the Boaz Weinstein-run fund to take control of the £1.1bn investment trust by a narrow margin, with 52.8 per cent voting against Saba’s resolution to appoint three of its nominees to the board.
Shareholders voted to retain the current board, a decision which chair of the company Tom Burnet argued reflected the “clear support” for the trust’s leadership and dislike for Saba’s repeated attempts to make changes at the top.
He said: “Repeatedly revisiting matters on which almost all of our independent shareholders have plainly already expressed their view places an unnecessary burden on the company, diverting management time and resources from the delivery of the company’s strategy and the creation of long-term shareholder value and incurring significant costs.”
US Growth Trust, whose portfolio includes the likes of SpaceX and Anthropic – noted that the votes against the resolution reached 99.2 per cent upon excluding the support of Saba and its ally Sessa Capital.
Saba swoops in
But the two hedge funds did successfully block two special resolutions on the disapplication of pre-emption rights, which would have given the board the right to issue or sell new shares without first offering them to existing shareholders, and share buybacks.
The resolutions required 75 per cent to pass, with both only receiving 63 per cent of votes in favour.
Burnet said the trust “looks forward to working constructively with Saba and Sessa” and is looking to secure a long-term solution with Saba, its largest shareholder.
The hedge fund’s latest attempt to wrest control of the fund is the latest in a string of efforts in the last two years to take over or shut down struggling investment trusts. It also follows several attempts by US Growth Trust to reach a settlement with Weinstein, including offering his fund an exit at net asset value of his stake in the trust.
In April, Edinburgh Worldwide Investment Trust (EWIT) – which was also managed by Edinburgh’s Baillie Gifford’s – conceded defeat to Saba, bringing its 17-month long battle to an end.
It succeeded in ousting EWIT’s board and chair Johnathan Simpson-Dent for its own three nominees.
Meanwhile, last month Gore Street Energy Fund narrowly survived an attempt by the notorious US hedge fund to wind-down.