The managing director of Miton, who ran the trust for almost 10 years at Gartmore before it was acquired by Henderson, is to take the helm following a proposed merger with his £96.7bn Diverse Income Trust. He will co-manage the trust with Martin Turner once the merger is complete, anticipated to be 14th February 2014.
Fledgling Trust shareholders will be given shares in the Diverse Income Trust, valued at a premium of 2.5%, and the Fledgling Trust will be wound up. Major shareholders M&G and AXA IM have already voted in favour of the changes.
Henderson has been served notice, and Miton will assume its management of the company’s assets in return for a 1% management fee.
Current managers Adam McConkey and Harmesh Suniara, who have been running the trust since January 2011, will be removed from the mandate.
The board is also seeking shareholder approval to change the investment objective to include scope to invest in larger companies, although the focus will remain on small and mid-cap companies.
Citing cyclical and structural issues, the board said that the fledgling index has recently underperformed against the FTSE All Share and small cap indices pushing it onto a wide discount.
It traded on an average discount to NAV of 20.6% for the 12 months until February 2013, compared to the UK Smaller Companies Investment Trust sector average discount of 15%.
