Board members of the Baillie Gifford US Growth and Keystone Positive Change trusts have today (6 January) condemned the requisition bids made by Saba Capital and urged all shareholders to vote against its proposals.
The US hedge fund acquired large stakes in each trust and used its influential position to recommend the complete replacement of both boards, as well as five other UK trusts.
It claimed the move would improve performance, yet Keystone’s chair Karen Brade said Saba’s proposal was made purely in its own self-interest.
“We are appalled by Saba’s actions and conduct,” she said. “We believe its proposed resolutions would be highly detrimental to the interests of all other shareholders.
“Be under no illusion – we believe this US hedge fund manager is acting opportunistically, seeking to seize control of the board without a controlling shareholding, to pursue its own agenda.”
Saba’s plan to replace each board with its own candidates would give it “effective control of the company,” added Tom Burnet, non-executive chair of Baillie Gifford US Growth.
While returns did drop 9% over the past three years, the trust’s board has been proactive in making improvements, with performance soaring 61.7% in the past year.
“Saba wants to subvert all of this,” Burnet said. “Their proposals lack detail and if implemented, could destroy the board’s independence, radically alter the investment strategy of the company and prove highly disruptive to shareholder value.
“We urge all shareholders to make their voices heard and to vote against Saba’s self-serving and destructive proposals.”