Evelyn Partners takes a stand against Saba in trust battle

In the UK, on January 10, 2025, Saba Capital, a New York hedge fund, escalated its stake in the Herald Investment Trust by offering shareholders a cash exit at a slight discount. Saba, which holds 20 percent of the £1.2 billion trust, has requested a shareholder meeting to replace current directors and install its nominees on the board. The hedge fund seeks to remove veteran fund manager Katie Potts, who has been at the helm for years. Fuelling the ongoing tension, Saba promised that if shareholders backed its resolutions, it would advocate for a full cash exit option at 99 percent of the trust's net asset value. This offer is designed to entice shareholders amid accusations from Herald that Saba's intentions are motivated by short-term benefits rather than the long-term interests of the trust. In a solid response to Saba's maneuvers, Evelyn Partners, a significant shareholder managing £62 billion in client assets, declared its intention to vote against Saba's proposals. As one of the top-five shareholders in a competing trust, Evelyn intends to support the existing board of the Baillie Gifford US Growth Trust, one of the seven trusts targeted by Saba. James Burns, head of Evelyn Partners, expressed concerns that Saba's actions could jeopardize the stability of these trusts and urged shareholders to consider the long-term implications of such a takeover. As the situation unfolds, the pressure mounts ahead of the critical meeting set for January 22, where shareholders are expected to voice their opinions on Saba's proposals and the future governance of the Herald Investment Trust. Investors are left weighing Saba's cash offer against the potential risks of handing over control to the hedge fund.