Shareholders of the Edinburgh Worldwide Investment Trust voted against Saba’s proposal to replace the board of the trust, possibly resulting in a shift of management, on 14 February.
Of the shares voted, 63.8% rejected Saba’s proposals. Not including the votes casted by Saba, 98.4% of shares voted against the changes. Friday’s vote was the last in a series of requisitioned meetings proposed by Saba across seven different trusts, which were all voted down.
Jonathan Simpson-Dent, chair of Edinburgh Worldwide, said: “Today’s result is about Edinburgh Worldwide’s shareholders. You have told us that Saba Capital’s proposals are not the answer. You want this unique mandate to continue and you want the trust to perform.
“I would like to thank our investors for taking the time to vote, and for their support. We all want an exciting and sustainable Edinburgh Worldwide, a Trust that appeals to long term shareholders. We continue to implement our action plan and will keep all shareholders informed on progress, including the previously announced capital return of up to £130m.”
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Currently, the Edinburgh Worldwide Investment Trust trades on a 7.3% discount, according to the Association of Investment Companies. Despite a strong share price total return of 25.2% in the last year, over the past three years the trust has lost 22.5%, compared to a sector average loss of 3.9%.
While the votes for proposed board takeovers have completed, on 11 February Saba requisitioned meetings with four more trusts to vote on open-ended alternatives for the funds.
Following the campaign by Saba, the AIC launched the ‘My share my vote’ campaign, advocating for all shareholders to be able to cast their vote.
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Richard Stone, chief executive of the AIC, said: “There are lessons to learn from these votes. It was only possible to achieve such high turnouts because of an unprecedented campaign from the companies, the industry, platforms and the media. We must make sure that shareholders are always informed and empowered to vote, rather than relying on goodwill and ad hoc efforts. That’s why we’re launching a campaign to change company law, ‘My share, my vote’, to ensure that voting rights and information are always passed on to shareholders.
“Boards have been rising to the challenge during this period of deep discounts. We’re seeing record levels of activity, such as share buybacks, mergers and strategic reviews. More than ever, boards are focused on discount management, their trust’s place in the market, and communication with existing and new shareholders. Independent oversight by boards is integral to the success of investment trusts and their focus on long-term objectives for the benefit of all shareholders, as opposed to short-term trading.”