In the event, there was no explosion. Instead, there was a clean-up effort that lasted years and the undamaged reactor did not reopen until 1985. However, the public’s confidence in the safety of nuclear power had eroded and Three Mile Island was eventually closed in 2019.

Grow your own

Despite the energy source remaining shrouded in speculation, in September 2024, Constellation Energy announced that Three Mile Island would be reopening, with Microsoft as the sole purchaser of its energy on a 20-year contract. The motivation? Powering Microsoft’s data centres for the growing presence of AI.

Microsoft is far from the only company to anticipate the burgeoning need for energy in coming years and to take matters into its own hands. However, as investments in AI have shot up in recent years, investments in energy, and specifically renewable energy, have tanked.

See also: Aegon: Data centres are the new dividend drivers

By 2030, the US Electric Power Institute estimates the energy demands of data centres could account for more than 9% of all US energy consumption. Currently, this sits at 4%. Jim Wright, fund manager of the Premier Miton Global Listed Infrastructure fund, says the phenomenon could lead to “a land grab” for energy supply and generation, exemplified by the Microsoft deal.

“The requirement for additional electricity will stretch the system capacity, particularly at seasonal and daily demand peaks. The inevitable solution is more investment in generation capacity, which will include renewables, batteries, gas-fired generation and nuclear power,” Wright explains.

“The costs, lead times and technological and regulatory challenges make new nuclear, either in the form of Small Modular Reactors or large power plants, a longer-term solution. There is considerable momentum, as shown by Meta’s recent request for developers to provide between one and four gigawatts of new nuclear capacity in the US to power its AI data centres.

“The growth in electricity generation capacity will require significant capital expenditure and changes the long-held perception of electricity utilities, which may now be classed as ‘growth stocks’ for the next decade.”

Read the rest of this article in the January edition of Portfolio Adviser Magazine

65.1% of the total votes cast were against the eight requisitioned resolutions, which would have seen the trust’s board replaced by Saba’s nominees if passed.

A majority of the trust’s total shares with voting rights participated in the vote.

PA Events: PA Live: A World Of Higher Inflation 2025

In a stock exchange announcement, the board said only a further 59,221 non-Saba shares, representing just 0.15% of the votes cast, voted in favour of the resolution.

Saba’s shares represented 34.75% of the total votes cast.

Andrew Joy, chair of Herald Investment Trust, said the result provides a “clear, complete and incontrovertible rebuttal” of Saba’s proposals.

“The votes against Saba’s proposals were supported by independent proxy advisers including Glass Lewis and ISS. It is perfectly clear that the reason Saba’s proposals were rejected is that they were intended to lead to an outcome, namely Saba managing Herald, which the existing shareholders were simply not interested in.

“The reason shareholders invested, and continue to invest, in Herald is for long-term capital appreciation through investing in smaller technology companies, and they do not wish to be deprived of the opportunity to enjoy more of the same. They did not invest in Herald to become part of a short-term trading strategy.”

See also: BlackRock enters pact with Saba to ‘not seek to control or influence the board’

Following the vote, Saba’s Boaz Weinstein said he had been encouraged by the “thoughtful engagement” from fellow Herald shareholders in recent weeks.

“Over a brief period, our campaign has already enhanced value for shareholders and incited positive change at HRI – and elsewhere in the U.K. market – as evidenced by discounts to net asset value narrowing and numerous trusts announcing shareholder-friendly actions.”

He added that Saba would continue to pursue changes it believes are necessary to improve the trust.

“Saba remains committed to putting shareholders’ interests first, delivering returns for UK trust investors and ultimately rehabilitating this broken sector. We urge shareholders of the six other trusts at which we have requisitioned General Meetings to support Saba’s resolutions in order to set these trusts on the path to meaningful value creation.”

‘Victory for shareholder democracy

Reacting to the outcome, Richard Stone, chief executive of the Association of Investment Companies, said: “It’s very encouraging to see Herald shareholders turn out to vote in such numbers.

“This is a victory for shareholder democracy. There are six other trusts with votes just around the corner. It’s vital that all shareholders vote on the future of their investment trust. Shareholders need to act now.”

Voting on similar proposals for the six other trusts requisitioned by Saba will take place over the coming weeks.

Baillie Gifford US Growth and Keystone Positive Change will vote on 3 February, a day before CQS Natural Resources Growth & Income and Henderson Opportunities Trust.

The European Smaller Companies Trust meeting is scheduled for 5 February, before Edinburgh Worldwide shareholders vote on 14 February.

BlackRock gained assurances from Saba that it would “not engage in any takeover offer”, “seek to control or influence the board”, or “seek to change the composition of the board”.

Trusts that made this pact with Saba include BlackRock’s World Mining, Smaller Companies, Energy and Resources Income, and American Income trusts. It will be in effect until 31 August 2027.

BlackRock reached these agreements despite noting that “Saba does not hold any interests in the issued share capital” of any trust.

Yet it may be an effort to protect itself in case Saba attempts to oust and replace its boards, as it has attempted with Keystone Positive Change, Baillie Gifford US Growth, Edinburgh Worldwide, Henderson Opportunities, and CQS Natural Resources Growth and Income, Herald, and European Smaller Companies.

Each of these trusts has urged shareholders to vote against Saba’s proposals, expressing that they are self-serving and are seeking to take effective control of each company.

Keystone’s chair Karen Brade said she was “appalled by Saba’s actions and conduct”.

“Be under no illusion – we believe this US hedge fund manager is acting opportunistically, seeking to seize control of the board without a controlling shareholding, to pursue its own agenda,” she added.

The Association of Investment Companies (AIC) and Edison have gone a step further, raising their concerns directly with the Financial Conduct Authority (FCA) that Saba’s plans are in breach of the UK Corporate Governance Code.

They argue that Saba’s appointment of its own candidates would break rules protecting board independence.

In its governance code, the City watchdog deems a director biased if they “represent a significant shareholder” or have “a material business relationship with the company” – two factors that could work against Saba, considering it owns between 19% to 29% of the shares in each trust.

Analysts at Edison added: “A scenario in which an activist hedge fund is a significant shareholder driving the replacement of the current boards with its proposed directors, and subsequently appointed as the trust’s investment manager, creates a conflict of interest, especially when setting the terms of the management agreement.”

Pellous moves to the group from Invesco, where he spent over a decade as a high yield and emerging market fund manager. He previously held roles at Legal & General, AllianceBernstein and AXA Investment Management.

See also: Stuart Parkinson becomes Stonehage Fleming CEO

His appointment follows a series of new additions made to Aviva Investors’ fixed income team. It hired Gita Bal as head of fixed income research earlier this month, and poached Fraser Lundie as global head of fixed income in May last year.

Daniel McHugh, chief investment officer at the firm, said: “The appointment of Fabrice represents the latest step in our efforts to expand our fixed income investment team.

“Fixed Income is a central pillar of our public markets offering, and our ambition is to have a market leading offering across all major sectors of the asset class.”

PA Live: A world of higher inflation

Yes, mistakes were inevitably made. We can say (with hindsight) that central banks sowed too many magic beans in 2020. And interest rates were kept too low through 2021, when there was already evidence for rising inflation and tighter labour markets.

But most central bank criticism was grossly unfair. In 2022, the world came face to face with an unfriendly inflationary giant for the third time in two years. There was little else central banks could have done. Indeed, in 2023 the Bank of England (BoE)’s models suggested that even with a crystal ball in 2021 telling them what shocks were coming, interest rates would have needed to break double digits to keep inflation at target. Such a move would also have pushed the unemployment rate into double digits, posing grave financial instability risks.

Oh no you didn’t …

Almost three years on from Russia invading Ukraine and we see many global risk assets at record highs, credit spreads near record tights, inflation and inflation expectations close to, or at, target, and unemployment rates close to historical lows (and at an all-time low in the eurozone). Central banks’ mandates are hitting inflation targets, protecting financial stability and/or maximising employment. Investors should be casting central bankers as heroes, not the villains of the show.

But no fable is without its moment of adversity and indeed the greatest opportunities for active fixed-income fund managers come when central banks make mistakes, when markets misinterpret their guidance, or when markets behave irrationally. Right now there’s great potential for all three.

Today we have one of the greatest market and macro consensuses ever seen. Hopes for ‘US exceptionalism’ with 3% growth rates forever are rife: long US equities and tech, long US dollar, bearish US treasuries on an outright basis and/or relative to other markets. Such heroic optimism is reminiscent of the bullish emerging versus developed market narrative from 2010-12, and that didn’t end well.

To read the rest of the column, visit the January edition of Portfolio Adviser Magazine

The Alger Focus Equity fund posted a return over the year of 56.3%, while another of its strategies, the $564m Alger American Asset Growth fund, was up 52.39%.

While surging share prices in Nvidia and other US tech stocks on the back of AI have been among the largest contributors to performance over the last year, the Alger American Asset Growth fund is one of the few actively-managed funds to beat the S&P 500 over a 10-year period.

See also: Yearsley: Financials ‘surprise winner’ of 2024

Speaking to Portfolio Adviser, Alger CEO and CIO Dan Chung says that the firm’s long-term performance is down to a lot more than just holding Nvidia.

Chung is a named manager alongside Dr Ankur Crawford and Patrick Kelly on Alger American Asset Growth, while Crawford and Kelly also run the Alger Focus Equity fund.

“Over a long-term period, its not about a single stock. It’s hundreds of decisions every year, and sometimes the decision is not to sell,” Chung says.

“We were early in Nvidia, buying in 2022. After 2023 saw a spectacular rise in the stock, a lot of people were saying that it must be time to sell, without carefully understanding the fundamentals of the business and how early on we are in the AI revolution. Our biggest and best decision was not to sell any of our Nvidia stock at that time, and it remains a top holding.

“Over the longer term, the success of the strategy has been a relentless focus on the depth and the quality of our team. 60 investment professionals for a firm of our size is actually quite a lot.

“We have a concentration of analysts that is probably 2-3 times more than a lot of our competitors.”

See also: Artemis merges European funds

The firm’s investment approach seeks to benefit from what Chung labels ‘positive dynamic change’. Reviewing the performance of the Alger American Asset Growth strategy over the last 10 years, in which it has posted a 430.8% return (as of 7 January), he says it has been a period of immense change.

“That period started with coming out of the great financial crisis, before entering into the most radical changes in American politics in decades.

“Our relentless focus on our philosophy of positive dynamic change – it means that culturally, as an investment firm, we’re very focused on embracing change. Don’t be afraid of disruption, innovation and volatility. Instead, we look at it as an opportunity to look for the positives that come out of these changes.

“The world is changing faster. There is more innovation and more disruption, which means winners and losers are created faster than they were in the past.

“It’s a highly competitive game. It requires people, but it also requires that right philosophy and mindset.”

European growth

The New York-based boutique is a growth equity specialist, and though it is better known back at home, the firm is looking to expand its offerings in Europe.

“We only have about 5% of our clients internationally — we have a two-person office here in London and a one-person office in Singapore, and we’re trying to grow in both regions.”

“We have been interested in talking with European asset managers in a similar situation, whether we can partner to help them grow in the US, and help Alger grow over here.

“There are some very obvious advantages for a European asset manager to consider partnering with a firm like Alger. We can offer significant US distribution. I’ve met many firms here that are actually quite large and don’t really have any US distribution, and we don’t have significant European distribution. The opportunity is pretty large.”

Industry M&A

The firm, founded in 1964 by Fred Alger, recently celebrated its 60th anniversary.

Industry M&A has seen many boutique firms in both the US and Europe swallowed up by larger asset managers.

However, Chung says that this trend has led to the unique selling points of larger asset managers becoming distorted, which can be exploited by existing boutiques.

“We’ve been taking advantage of the industry structure right now. In traditional asset management, you have a few global giants, and then you have a lot of very big companies just outside of the top 10.

“A lot of them have been created out of multiple mergers. The challenge there is that they don’t have the distribution scale of the largest names, and because they’ve been created out of mergers, a lot of them are like supermarkets. They offer everything, but they’ve lost a little bit of what they are best at.

“They all originally had something that they were really good at, whether it was bonds, equities or real estate, but now that they’ve become these large ‘supermarkets’ – they’re trying to compete with the Costco’s and the Tesco’s.

“They have a lot of challenges because it’s hard for them to grow as they’re large already. Their cultures are just within the team of the investing, and they’re not necessarily particularly known to be particularly at any one thing.”

Consensus expectations for core inflation had been a 30 point increase. Headline CPI rose two percentage points to 2.9% in December, in line with expectations.

The increase was fuelled by energy prices, which accounted for over 40% of the monthly rise, while food prices also contributed.

The data release follows on from UK inflation figures for December, revealed earlier today, which revealed an unexpected drop in headline inflation to 2.5%.

See also: ‘Not out of the woods yet’: UK inflation falls by 10 basis points in December

Hetal Mehta, head of economic research at St. James’s Place, said the US inflation data would come as a relief to a wide variety of policymakers as global yields move lower.

“Core inflation surprised on the downside and there are tentative signs that inflation pressures may have stopped building after months of acceleration. But headline inflation did tick up and more evidence of inflation moderation will be necessary to get the Fed comfortable with multiple rate cuts this year.

“We don’t think these data change our view of a soft landing, with growth moderating to a trend-like pace. The Fed has the firepower to cut rates if things do start to deteriorate materially.

“Overall, the outlook is still quite muddy as so much will depend on what the Trump administration comes up with policy wise (especially tariffs and immigration).”

See also: The undervalued markets where managers are diversifying away from the US

With all eyes on the bond market in recent weeks, treasury yields have ticked lower in early trading following the release of the inflation print.

“The US Treasury market, and global rates markets, breathed a sigh of relief as the US CPI contained few surprise. In fact, the small miss on core CPI was cheered on by the market, pushing bond yields sharply lower. Headline CPI was 2.9% year-on year,  bang in line with consensus but higher than the 2.7% reading in November,” said Aegon Asset Management investment manager Colin Finlayson.

“The small miss on Core CPI at 3.2% vs 3.3% – led by an easing back in core services prices – was welcome relief to investors after a relentless sell off over the last month.  For a market living on its nerves, anything other than an upside surprise was a ‘win’.  

“After the softer inflation data in the UK this morning, this has offered a crumb of support to bond market ‘bulls’ and was a reminder that things other than fears over fiscal spending and term premia can drive Government bond markets.  For the Fed, this keeps the path in rates still to the downside and has brought forward the pricing of the next cut from December – as it was after the recent employment report – to July.”

Tina Adatia, head of fixed income, client portfolio management at Goldman Sachs Asset Management, added: “After recent red-hot data, today’s softer than expected core CPI reading should help cool fears of a reacceleration in inflation.

“While today’s release is likely insufficient to put a January rate cut back on the table, it strengthens the case that the Fed’s cutting cycle has not yet run its course. With labour market data remaining robust, however, the Fed has scope to be patient and more good inflation data will be required for the Fed to deliver further easing.”

Over the past year, the US hedge fund has built large positions in Baillie Gifford US Growth; CQS Natural Resources Growth & Income; Edinburgh Worldwide; European Smaller Companies; Henderson Opportunities trust; Herald and Keystone Positive Change investment trusts.

Votes will be held in the coming weeks over Saba’s proposal to replace the boards of each trust with its own directors.

See also: Home REIT publishes overdue 2023 results as board steps down

In a webinar held today (14 January), the Saba Capital founder said that if the firm is successful in replacing the current boards, Saba would seek to merge either some or all of the trusts into a new listed vehicle and invest back into UK assets.

“If we’re given the opportunity, we would launch this Saba product that I think the UK sorely needs, given how every institution has been a seller,” said Weinstein.

“We are the white knight of the UK market. Everyone is a seller, we are a buyer.”

He added: “We are here to not just buy your trusts, we are here to buy billions more and rehabilitate this broken set of trusts and what is – in some ways – a broken industry that hasn’t been able to grow.”

He also took aim at the current boards of the seven trusts, criticising them for poor performance and having a lack of ‘skin in the game’.

Speaking to investors, Weinstein added: “This discount is not some ephemeral thing. It is costing ‘mom and pop’ investors in these trusts enormous amounts of money year in and year out. We are on the same side as you. We are invested alongside of you.”

Meanwhile, he also claimed that Saba’s action has already generated returns for investors with discounts narrowing over the last month.

“My prediction is in the coming three months, many of the trusts that Saba holds will announce shareholder friendly actions that will make you additional hundreds of millions of pounds that you would not otherwise have made because they want to head us off at the pass.

“The entire UK closed-end fund space in general will see smaller discounts, especially if we win and we have this fire power to buy up UK trusts. We’re talking about 83.3% invested outside of the UK that we may bring up to 100% invested in the UK.”

He also criticised aspects of the coverage of Saba’s plans, claiming that information provided by trust boards to shareholders comparing the performance of Saba’s own funds was “blatantly incorrect”.

See also: Update: Saba plans full cash exit option for Herald

Board independence

A large part of the concerns over Saba’s plans has been over the independence of boards, given that Saba is aiming to replace each trust’s board with directors who would be affiliated with Saba.

However, he said that having just two board members would be a temporary measure, with independent NEDs being appointed later on.

Reacting to the webinar, Laith Khalaf, head of investment analysis, AJ Bell, said that if Saba wins some of the forthcoming votes, the investment trust industry may have to prepare for more of the same.

“Whatever the results of the upcoming shareholder votes it will be interesting to see if the arrival of Saba prompts investment trust boards to take more measures to address large discounts,” he said.

“Shareholders will soon get the final say on whether Saba carries the day or not. Investors in each trust need to carefully examine the options and arguments laid out before them, both by Saba and the existing board, before coming to a decision and voting their shares.

The first vote will take place on 22 January, where Herald investors will have the opportunity to either back Saba or the current board.

Net asset value fell to £216.9m from £345.9m over the financial year, which came largely due to a £71.4m decrease in the fair value of investment properties.

The overall loss before tax for the year to 31 August 2023 amounts to £118.2m.

Following the publication of the overdue results, board members Peter Cardwell, Lynne Fennah, Simon Moore and Marlene Wood have all stepped down from the board.

The trust’s shares have remained suspended since early 2023, after it was unable to publish its results for the 2022 financial year on time.

See also: Home REIT repays Scottish Widows loan

Michael O’Donnell, chair of Home REIT, said: “The publication of the 2023 Annual Report and Accounts is a further positive step toward the relisting of the company’s shares.

“We remain focused on optimising the value of the portfolio and maximising returns to shareholders, while keeping disruption to underlying residents to a minimum, in line with the company’s Managed Wind-Down strategy.

“The company has made significant progress in recent months, with debt now fully repaid and the remaining portfolio launched for sale. I would like to once again thank shareholders for their ongoing patience as we continue to work towards the resolution of the remaining challenges facing the company.”

Since August 2023, the trust has sold or exchanged on the sale of 1,622 of its properties in a bid to pay down its borrowings, raising £244.1m.

As part of the firm’s managed wind down process, its remaining property portfolio of 851 assets is currently being marketed for sale, being independently valued in excess of £175m.

Home REIT has received a pre-action letter from Harcus Parker on behalf of a group of shareholders in the trust.

The trust’s board said it intends to “vigorously” defend itself in respect of the threatened litigation and has denied the allegations made against it.

Meanwhile, it reaffirmed its intention to bring legal proceedings against its former investment adviser, having issued pre-action letters last year to Alvarium Fund Managers (UK) Limited and AlTi RE Limited on 12 April 2024 and to Alvarium Home REIT Advisors Limited.

The strategy, which has a 0.55% total expense ratio, will list tomorrow (15 January) on the London Stock Exchange. It is also available to European investors on the Börse Xetra and Borsa Italiana.

Classified as an article 8 SFDR fund, it aims to offer investors access to commodities associated with energy transition themes such as electric vehicles, transmission, charging, energy storage, solar, wind and hydrogen production.

See also: SJP equity fund aligns with SDR Sustainability Focus label

The ETF will track the underlying WisdomTree Energy Transition Metals Commodity UCITS Index.

Through a partnership with data solutions firm Wood Mackenzie, the selection and weighting of the underlying metals will be based on a forward-looking rating system.

The metals are given an ‘intensity rating’, which combines the demand growth forecast for the metal over three years with a market balance rating that reflects whether the metal is under or over supplied. The portfolio then rebalances twice a year.

Nitesh Shah, head of commodities and macroeconomic research, Europe, at WisdomTree, said: “Metals will be crucial to advance the energy transition. Whether it is to power more electric vehicles or create solar panels, it’s hard to see a world where the development of energy transition technologies is not dependent on the supply of some key metals. However, the challenge is to ensure that the technologies needed to achieve the energy transition are produced at scale.

“The challenge for investors is to navigate through the dynamics of technology shifts, trade policies and sudden increases in metal supply. The expertise offered by our partnership with Wood Mackenzie and a methodology that incorporates both supply and demand drivers help the strategy remain highly adaptive to the evolving market.” 

Additionally, the external fund manager will change. The £5.2bn fund had been run by Kirsteen Morrison and David Winborne at Impax Asset Management, but Schroders will take over as the fund’s sole manager going forward. The fund will also invest in Schroders’ Global Sustainable Growth and Global Value Equity investment strategies in order to increase the range of companies the fund can invest in.

According to St. James’s Place, the changes – which will come into effect from 24 February 2025 – will improve diversification and introduce a more balanced blend of investment styles, while maintaining the focus on sustainability, which is required to meet the FCA’s new higher threshold for sustainable investments.

See also: “EY: Investors display ‘worrying level of apathy’ to ESG“

Ongoing charges will be reduced by 0.01% as a result of these changes.

Justin Onuekwusi (pictured), chief investment officer at St. James’s Place, said: “The bar to be a labelled fund is very high and will help clients to better understand how their money is being invested in companies that aim to deliver a positive outcome for people and the planet.

“Schroders is a well-regarded expert of sustainable investing, with a diversified approach. They have depth of experience across different equity investment strategies, which can provide a more balanced blend of investment styles for the fund.

“We’d like to thank the team at Impax for their expertise, partnership and their key role in the success of the fund to date. We continue to see Impax as a leader in investing in the transition to a more sustainable economy and a key partner for us in the future.”

Alex Tedder, co-head of equities at Schroders, added: “This investment allocation by SJP underlines the quality of our active investment process and commitment to delivering sustainable outcomes for our investors.

“Clients, investors and the industry are increasingly focused on bespoke investment solutions that can deliver strong risk-adjusted returns together with a comprehensive commitment to sustainability. Our broad-based capability and commitment to active management puts us in a strong position to meet client objectives in a rapidly transforming investment environment.”

This article was originally published by our sister title, PA Future

US-based hedge fund Saba Capital is attempting to take ownership of seven UK investment trusts in total that it currently owns shares in, including Keystone Positive Change, Henderson Opportunities Trust and Baillie Gifford US Growth.

Plans put forward by Saba, which was founded by its CIO Boaz Weinstein in 2009, would see the trusts’ independent boards replaced by two new directors, as well as a change to the companies’ mandates and investment managers.

See also: Update: Saba plans full cash exit option for Herald

According to a London Stock Exchange announcement published today (14 January), ISS has stated that Saba “has not presented a compelling case for change, let alone a case for a majority position on the board and a strategy overhaul” ahead of Herald’s general meeting. It has therefore recommended that shareholders vote against the requisitioned solutions at the meeting, which will take place at midday at 10-11 Charterhouse Square in London.

The recommendation follows a circular published by Herald investment trust on 3 January this year, whereby the board unanimously recommended that shareholders vote against Saba’s attempted takeover.

Andrew Joy, chair of Herald investment trust, said: “The board of Herald welcomes and is encouraged by the recommendation from ISS for shareholders to vote against the requisitioned resolutions proposed by Saba on 22 January 2025. The recommendation supports our belief that the proposals from Saba are not in the best interests of all shareholders, and we strongly urge all shareholders to vote against the requisitioned resolutions proposed.”

The Herald investment trust is the first company to have scheduled a meeting for shareholders to vote on the proposals, with a majority of the other trusts scheduling meetings during the first week of February.

Herald hits back at performance claims

In a separate LSE announcement this morning, Herald investment trust’s board has responded to Saba’s claims that its strong performance track record justifies its desire to take over the trust.

See also: Saba Capital launches campaign to replace seven investment trust boards

According to Herald, the trust has “materially outperformed” the Saba Capital Master Fund – the US firm’s flagship product – since its launch in August 2009 – on both an annualised and cumulative basis.

“The board believes that the Saba Master Fund has delivered an annualised net return of approximately 4.8% from 1 August 2009 to 7 June 2024 (being the latest date to which its performance data is available from public sources), implying a cumulative return of approximately 99.5% (in each case calculated in USD, the Saba Master Fund’s base currency),” it said. “In direct contrast, Herald’s annualised NAV total return over the same period was 14.1%, or a cumulative return of 611.4% (in each case calculated in GBP, Herald’s base currency).”

“Furthermore, the reported discrete annual returns for the Saba Master Fund raise questions regarding the potential volatility of Saba’s strategy. For the 13 years that annual performance data is available publicly from third party sources and press articles (2010 to 2023 inclusive, with the exception of 2017. Only cumulative or partial data is available for 2009, 2017 and 2024), the Saba Master Fund delivered negative annual performance in six of the 13 years according to such sources.

“Over the same period, Herald’s discrete annual NAV total return was negative in only three years.”

See also: Baillie Gifford: ‘We are appalled by Saba’s actions and conduct’

Therefore, Herald’s board does not believe that appointing Saba to take over the trust would be in the best interests of shareholders, adding that the firm wants to take control of the trust, “in part, add to its own assets under management”.

“Saba’s proposals, which lack any meaningful detail apart from the intention to appoint itself as manager, fundamentally change the company’s investment strategy and offer an uncapped cash exit on uncertain terms, risk significant value destruction for shareholders and are the anthesis of the company’s successful long-term investment approach.”

Herald’s board added: “The board believes that Saba’s proposals are designed for its own economic benefit and will be to the detriment of those shareholders who wish to remain invested in a proven strategy which has delivered a 27x NAV total return since the first day of dealings.”