The Miton UK MicroCap Trust board has proposed a voluntary wind up after shareholders raised concerns over the size of the investment trust.
In a stock exchange announcement, the board said that following redemptions made this year, the trust is now at a size which some investors consider to be too small from a liquidity perspective.
As a result, the trust’s board has proposed a voluntary wind up.
The £34.6m trust currently trades at an 11% discount to its net asset value, according to the AIC.
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However, the board said that shareholders held positive views of the investment manager and the current opportunity set in UK small and micro caps. Therefore, the board has discussed rolling the trust into one of Premier Miton’s open-ended funds, while it also expects to offer a cash exit.
Reacting to the announcement, QuotedData senior research analyst senior research analyst Matthew Read criticised the timing of the trust’s 2024 redemption point, which came ahead of the Autumn Budget.
“This story reinforces my antipathy towards 100% exit opportunities. The timing of this – ahead of a budget where it was widely and correctly rumoured that there would be changes to capital gains tax, and to inheritance tax on AIM shares – was inevitably going to mean a rush for the exit. Yet again, investors are selling at the bottom.”
