The Edinburgh Worldwide Investment Trust (EWIT) has labelled a campaign by US hedge fund Saba Capital as an “existential threat”, and is urging investors to oppose the hedge fund’s plan to oust its board and install its own nominees, according to a report by ThisIsMoney.
A vote is scheduled for 14 February, with Saba Capital, which is led by Boaz Weinstein and holds a 21% stake in EWIT, needing at least 50% of voting shareholders to back its proposal to take control of the board.
EWIT Chairman Jonathan Simpson-Dent accused Saba of an “overt land grab,” arguing that the hedge fund is attempting to exploit the trust’s large base of retail investors, who historically participate less in shareholder votes. Retail shareholders own about half of the trust’s shares, giving them the collective power to block Saba’s efforts.
“Investment trusts are extremely democratic by nature—Saba’s proposals are not,” Simpson-Dent said. “Shareholders have chosen Edinburgh Worldwide for its unique access to groundbreaking businesses. Let’s not let Saba take that away.”
Saba has criticised EWIT’s recent performance, claiming the trust has underperformed its benchmark for the past three years. A Saba spokesperson suggested that the trust’s recent uptick in returns was due to the hedge fund’s own buying activity rather than the trust’s investment strategy, which focuses on small, innovative companies.
Currently managed by Baillie Gifford, EWIT oversees £812m in assets, investing in what it describes as companies at the “frontiers of technological innovation.” Notable holdings include Elon Musk’s SpaceX, quantum computing firm PsiQuantum, and biotech company Alnylam Pharmaceuticals.
Saba’s bid for EWIT is part of a broader campaign targeting seven investment trusts, including Herald, which is set to face a vote imminently.
