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Daily Mail
01-08-2025
- Business
- Daily Mail
Investment trusts rise up from the ashes
A cloud can have a sizeable silver lining. The failure by Wall Street hotshot Boaz Weinstein to acquire seven investment trusts cheaply this year is sparking a rebound of the sector. Multi-millionaire Weinstein, who is chief investment officer of the activist Saba Capital hedge fund, may have thought shareholders would, unquestioningly, back his campaign. But they rejected his approaches, recognising the true value of their stakes in these trusts. Their resistance is bringing about an upheaval. It's time to think again if you thought trusts – some set up in Victorian days – were an anachronism. Darius McDermott, boss at funds ratings agency Fundcalibre, says: 'The sector was on its knees – no buyers, only sellers, and discounts and yields at record highs.' A trust is at a discount if its share price is below its net asset value (NAV). McDermott says: 'Sentiment has started to recover, and we think the best opportunities lie ahead. Professionals have spotted the value. It's time private investors took notice too.' Boards are taking tough decisions to shrink discounts. They are also exploring mergers or ordering reviews of their trusts' futures. The continued existence of more trusts is in question. New activist investors are emerging – and pressing for change. The main players are management groups Harwood Capital, which operates investment trust Achilles, and Asset Value Investors. The Asset Value Investors stable includes the Migo Opportunities trust, whose co-manager Charlotte Cuthbertson says: 'Activist agitation is the primary catalyst for returns now and can deliver a wealth of opportunities from once-in-a-generation discount levels.' She argues it is necessary: 'Sentiment alone won't close the gap between prices and NAVs.' Emma Bird, head of investment trust research at trader Winterflood Securities, says mergers will produce 'larger and more liquid trusts', presenting a more compelling long-term proposition. One illustration is last month's get-together of Henderson European and Fidelity European. But there is bid activity too. In May the FTSE 100 real estate investment trust (Reit) LondonMetric, which owns pubs, shops and Warwick Castle, paid £699m for the FTSE 350 'mega-shed' specialist Reit Urban Logistics. The bid price was an 11 per cent premium on Urban Logistics' price back in April, valuing the trust at a 5 per cent discount to its NAV. The deal was triggered by the Achilles trust, an investor in Urban Logistics. If you have been dismayed by the performance of trusts you hold, it makes sense to sit tight and hope that the shake-up gives a lift. But if you want to take advantage of disruption by activists, follow this guide. MIND THE GAP At the beginning of 2025, the average investment trust discount was 16pc –largely due to the superior returns paid by less risky deposit account and bonds. This has narrowed to 13 per cent – although brokers Stifel say the gap between price and NAV at 50 trusts is now 5 per cent or less. Biotech trust Syncona may be at a 50 per cent discount, but Seraphim Space has shrunk from 53 per cent to 15 per cent thanks to the recognition that its military application satellite investments will be boosted by increased defence spending. Bird says that share buybacks are one strategy being deployed by boards to reduce discounts. If you acquire a trust at a discount, you're buying assets for less. But there is an element of jeopardy, as no mechanism is guaranteed to minimise the gap between share price and the NAV. HOW TO BACK BRITAIN Winterflood's Emma Bird comments: 'There are arguably too many UK equity income trusts, which is why the board of Murray Income last month commissioned a review.' Murray is at a discount of 7 per cent. Directors may seek a merger or replace its managers Aberdeen. People with money in this trust, like me, will be happy for some resolution of the problem. It is also worth taking a closer look at the UK Equity Income sector. The best-buy City of London trust is at a premium of 1 per cent, but Diverse Income, another recommended trust, is at a discount of 4 per cent. Temple Bar, whose discount is just 0.41 per cent, is one of my backing-Britain investments; its portfolio encompasses Aviva, Marks & Spencer and NatWest. GET AN ENERGY BOOST In the infrastructure and renewable energy sector, yawning discounts indicate that bargains are to be found for those with patience. The typical discount on an infrastructure trust that invests in bridges, hospitals, roads etc, is about 14 per cent. This rises to about 25 per cent for trusts that back renewable energy projects, which has put them in the sights of the Migo Opportunities trust. Cuthbertson comments: 'This is where the next wave of activism is focused, and so are we.' Downing Renewables & Infrastructure has succumbed to a bid, at a 24 per cent premium to the price on June 19, but still below its NAV. As an investor I could have hoped for more but the dividend yield has been some compensation. The Law Debenture trust has just taken stakes in Greencoat UK Wind, where the discount is 19 per cent, and HICL Infrastructure which is at a discount of 20 per cent. HICL's holdings include hospitals and the Home Office building. Law Debenture managers consider the discounts on these two trusts to be 'unjustifiably high'. Both offer generous dividends which makes it worth waiting for developments. The SDCL Energy Efficiency trust has an attractive 11 per cent yield, as McDermott highlights – but is at a 38 per cent discount, so strong nerves are needed. Ben Yearsley of Fairview Investing is a fan of two other renewables trusts: Foresight Solar (discount 18 per cent) and Greencoat Renewables (24 per cent). BRICKS AND MORTAR Reits are an area where activists are hoping to exploit falling borrowing costs and rising rents. McDermott picks TR Property, which is at a 7 per cent discount. Cuthbertson cites Aberdeen European Logistics Income which has been selling chunks of its portfolio to address its discount of 18 per cent. She argues that further improvements should be in the offing. If you are up for an adventure, McDermott points to Chrysalis (discount 27 per cent) where holdings include the Swedish buy now, pay later group Klarna. Yearsley's pick is Artemis UK Future Leaders (15 per cent), a smaller companies trust. Or you could take a gamble on the activists producing a much better return. Achilles is at a tiny 0.19 per cent discount. Migo Opportunities, which has stakes in Chrysalis and SDCL Energy Efficiency, is at a discount of 4 per cent. This attention to the level of their own discounts bodes well for their ability to impress on other trusts the vital importance of this feature.
Yahoo
23-05-2025
- Business
- Yahoo
Holding(s) in Shares
TR-1: Standard form for notification of major holdings 1. Issuer Details ISIN GB00B02QND93 Issuer Name PAYPOINT PLC UK or Non-UK Issuer UK 2. Reason for Notification An acquisition or disposal of voting rights 3. Details of person subject to the notification obligation Name Harwood Capital LLP City of registered office (if applicable) Country of registered office (if applicable) Name City of registered office Country of registered office Harwood Capital LLP London United Kingdom 4. Details of the shareholder Name City of registered office Country of registered office Harwood Capital LLP London United Kingdom North Atlantic Smaller Companies Investment Trust Plc London United Kingdom 5. Date on which the threshold was crossed or reached 21-May-2025 6. Date on which Issuer notified 22-May-2025 7. Total positions of person(s) subject to the notification obligation . % of voting rights attached to shares (total of 8.A) % of voting rights through financial instruments (total of 8.B 1 + 8.B 2) Total of both in % (8.A + 8.B) Total number of voting rights held in issuer Resulting situation on the date on which threshold was crossed or reached 4.053000 0.000000 4.053000 2852000 Position of previous notification (if applicable) 3.031910 0.000000 3.031910 8. Notified details of the resulting situation on the date on which the threshold was crossed or reached 8A. Voting rights attached to shares Class/Type of shares ISIN code(if possible) Number of direct voting rights (DTR5.1) Number of indirect voting rights (DTR5.2.1) % of direct voting rights (DTR5.1) % of indirect voting rights (DTR5.2.1) GB00B02QND93 2000 0.003000 GB00B02QND93 2850000 4.050000 Sub Total 8.A 2852000 4.053000% 8B1. Financial Instruments according to (DTR5.3.1R.(1) (a)) Type of financial instrument Expiration date Exercise/conversion period Number of voting rights that may be acquired if the instrument is exercised/converted % of voting rights Sub Total 8.B1 8B2. Financial Instruments with similar economic effect according to (DTR5.3.1R.(1) (b)) Type of financial instrument Expiration date Exercise/conversion period Physical or cash settlement Number of voting rights % of voting rights Sub Total 8.B2 9. Information in relation to the person subject to the notification obligation 2. Full chain of controlled undertakings through which the voting rights and/or the financial instruments are effectively held starting with the ultimate controlling natural person or legal entities (please add additional rows as necessary) Ultimate controlling person Name of controlled undertaking % of voting rights if it equals or is higher than the notifiable threshold % of voting rights through financial instruments if it equals or is higher than the notifiable threshold Total of both if it equals or is higher than the notifiable threshold Christopher Harwood Bernard Mills Harwood Capital LLP 0.003000 0.003000% Christopher Harwood Bernard Mills North Atlantic Smaller Companies Investment Trust Plc 4.050000 4.050000% 10. In case of proxy voting Name of the proxy holder The number and % of voting rights held The date until which the voting rights will be held 11. Additional Information 12. Date of Completion 22/05/202513. Place Of Completion London Stock Exchange
