SHAREHOLDERS in Alliance Trust have warned they risk creating “major problems” at the Dundee investment house if they do not back the board’s proposal to buy out the stake of activist investor Elliot Advisors.
ShareSoc has urged investors in the venerable trust to vote in favour of the resolutions tabled by the board at the Alliance annual meeting on February 28.
The board is seeking support for a radical new investment approach at Alliance after US-based Elliot waged a vigorous campaign for change to improve its performance, with the changes including a shift to a multi-manager approach to run the 129-year-old trust and the sale of Alliance Trust Investments (ATI) to Liontrust Asset Management.
Shareholder support is also being sought for the proposal by Alliance Trust to buy the entirety of Elliot’s near 20 per cent shareholding, agreed between the two parties in January.
ShareSoc warned: “If the resolutions are the General Meeting were defeated then it would put the company back at square one and potentially create major problems. Investors need to consider the proposals bearing in mind the history of the company and the other options available.”
ShareSoc said the Alliance Trust Shareholder Action Group has been satisfied with the progress the board has made in revitalising the trust since its appointment, highlighting the substantial reduction in the share price discount to net asset value – “a long standing concern of many investors” – the disposal of the non-core ATI and steps to make Alliance Trust Savings profitable.
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