New York hedge fund Saba Capital Management has requisitioned a meeting to replace the directors of Edinburgh Worldwide Investment Trust.
As the mood between the fund and the trust becomes more hostile, Saba will ask shareholders to sack the incumbents and appoint three independent directors “committed to delivering long-term value”.
It comes after its initial move was rejected by the EWIT board last week and amid plans by EWIT to merge with fellow Baillie Gifford-managed US Growth Investment Trust.
EWIT, a FTSE 250 constituent, is focused on smaller and middle-sized growth companies and is valued at about £700 million.
Saba owns 30% of EWIT and has sent a letter to shareholders explaining its case and calling for a meeting early in the new year.
Its board nominees are Gabi Gliksberg, founder and managing partner of ATG Capital Management; Michael Joseph, a portfolio manager at Stansberry Asset Management; and Jassen Trenkow, a former banker at Barclays and Goldman Sachs Asset Management.
This is Saba’s second tilt at EWIT, one of seven UK trusts it targeted in a bid to improve their performance. In February, shareholders overwhelmingly rejected Saba’s approach.
Responding last week to Saba’s new proposal, EWIT’s chairman, Jonathan Simpson-Dent, said: “Throughout the last year we have sought to engage with Saba to understand their objectives and to enter into a constructive dialogue regarding options for an equitable and holistic solution, including a return of capital.
“Saba’s open letter does not represent the significant progress EWIT has made since this board reset the company on a path for growth a year ago.”