Saba Capital was defeated in a shareholder vote for the fourth time today (4 February) as investors in Henderson Opportunities rejected the hedge fund’s proposals.
Almost three-quarters (73.4%) of the trust’s shareholders participated in its general meeting this morning, with 65.4% of the votes cast going against Saba’s plans to oust chair Wendy Colquhoun and the board of directors.
Most of the votes in favour of the resolutions came from Saba, with just 0.7% of shares not affiliated with the firm voting in favour.
See also: Saba loses Keystone and Baillie Gifford US Growth votes
Yet Saba refrained from voting with all of the shares it owns in the trust. It used 24.7% of shares in the general meeting despite announcing it owned 29.1% of the trust’s shares on 29 January.
James Carthew, head of investment companies research at QuotedData, speculated that Saba may have sold some of its shares in Henderson Opportunities ahead of the vote.
“This is the second time that Saba seems to have voted fewer shares than expected. I am starting to wonder if it had already started selling them before the meeting in expectation that it was going to lose,” he said
“Given the consistent pattern of rejecting Saba’s proposals, it would perhaps be a better idea if it simply withdrew the remaining requisitions.”
See also: Henderson European trust portfolio managers resign
CQS Natural Resources Growth and Income also voted against Saba’s proposals today, while the European Smaller Companies vote will take place tomorrow (5 February). Edinburgh Worldwide’s vote commences on 14 February.
Richard Stone, chief executive of the AIC, said: “Shareholders of Henderson Opportunities Trust and CQS Natural Resources have rejected Saba’s plans, which would have fundamentally changed the nature of their investment. The defeat of these resolutions demonstrates the combined power of thousands of individual shareholders, as well as wealth managers and institutions, who backed the investment trusts’ boards.
“It’s essential that shareholders in Edinburgh Worldwide who have not yet voted their shares do so, as the deadline is fast approaching.”
For Henderson Opportunities, the priority now will be to execute the plan to reconstruct and wind down it announced yesterday.
Shareholders will vote on these proposals on 21 February, but Saba still has enough shares to block them from going through.
The trust’s chair, Wendy Colquhoun, said: “As part of its campaign, Saba has publicly stated its aim to deliver substantial liquidity options to all shareholders. The scheme proposed by the board is designed to achieve this.
“The board therefore calls on Saba to respect the decision made by the company’s shareholders at today’s meeting and support the scheme of reconstruction.”