Published by Global Banking and Finance Review
Posted on January 24, 2025
(Reuters) - Two British investment trusts run by Janus Henderson urged investors on Wednesday to reject a Saba Capital Management proposal to replace their entire boards, a change they said would effectively cede control to the U.S. activist investor.
Saba, founded and run by Boaz Weinstein, said last month it wanted to overhaul the boards of seven trusts over performances it said ranged from "underwhelming" to "disastrous".
The hedge fund has nominated Weinstein to the board of Baillie Gifford US Growth Trust and Paul Kazarian, a lead portfolio manager, to the other six fund boards.
Wendy Colquhoun, chairman of one of the two trusts, Henderson Opportunities Trust plc, said on Wednesday that Saba's resolutions carried "significant uncertainty and risk".
The trust is currently offering shareholders the choice of a full cash exit at net asset value, or the option to roll over into an open-ended fund managed by Janus Henderson Investors.
"Saba is attempting to take control of the company with no assurances as to what will happen to shareholders' investments," Colquhoun said in a statement.
The European Smaller Companies Trust, another Janus Henderson-managed fund targeted by Saba, also called for shareholders to reject the proposal, with its Chairman James Williams calling Saba's motives "self-serving".
"Janus Henderson’s proposed reconstruction scheme for HOT (Henderson Opportunities Trust) is inferior to our nominees’ plan and their claim that Saba would seek higher fees at shareholders’ expense if selected as investment manager is made up," Saba said in an emailed response to Reuters.
The other trusts it is targeting include Baillie Gifford US Growth Trust, CQS Natural Resources Growth & Income, Edinburgh Worldwide Investment Trust, Herald Investment Trust and Keystone Positive Change.
Keystone also hit back on Monday, saying it was "appalled by Saba's actions and conduct".
(Reporting by Yamini Kalia in Bengaluru; Editing by Mrigank Dhaniwala, Sinead Cruise, Jan Harvey and Alexander Smith)
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