Saba Capital has demanded a second general meeting of CQS Natural Resources Growth and Income shareholders less than a week after suffering an overwhelming loss at the previous vote it called.
Its proposals to replace the board were rejected by 98.6% of votes cast by non-Saba shareholders at the requisitioned general meeting last week (4 February).
Yet the US hedge fund returned with a second proposal on Monday for shareholders to create an open-ended version of the trust, which would be managed by Manulife | CQS Investment Management or its affiliate.
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The trust’s chairman, Christopher Casey, said the notice was served with no prior engagement by Saba.
“We are disappointed to receive another requisition from Saba without any dialogue and which follows a very recent shareholder vote firmly endorsing the ongoing CYN Board strategy,” he added.
“Not only do we already hold an annual continuation vote, but we have announced a strategic review which is advanced. Our priority remains ensuring the best outcome for all shareholders.”
The strategic review it announced in early January said the trust was considering creating an open-ended investment company with a natural resources and energy focus, with the option for a full cash exit.
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It also floated ideas for share buybacks, an increased dividend, and a potential combination with another investment trust to lower its discount.
Seeing as the board was already contemplating an open-ended version of the trust and other methods to lower its discount, Casey said Saba’s new proposal is “without merit”.
“Saba’s actions in calling the second requisitioned general meeting, so soon after the first requisitioned general meeting, are wasteful of shareholders’ funds, the company’s resources and everyone’s time,” he added.