In an effort to reverse what the activist investor sees as “unprecedented” value destruction, Bose Weinstein is calling for the removal of the entire board of the tech-focused fund run by Bailey Gifford.
In A letter Before the board of Edinburgh Worldwide Investment Trust on Thursday, Weinstein – whose activist investment firm Saba Capital Trust owns about 30% of the shares – said the board had “objectively and clearly failed” to deliver the performance expected by shareholders.
EWIT’s portfolio includes a global mix of small and emerging public and private companies focused on tech innovation and transformation, targeting “significant disruptive growth potential,” according to London-listed Baillie Gifford’s website.
Its holdings include Elon Musk’s Space Exploration Technologies, or SpaceX, which accounts for 8.4% of its portfolio.
Weinstein said EWIT’s net asset value is down 30.8% over the past five years, while its share price return has fallen 35%, compared to its self-selected benchmark, the FTSE All-Share Index, which is up 71.4% over the same period.
That means the company’s NAV return and share price performance ultimately lag the benchmark by more than 100% over a five-year period, Saba noted in the letter.
Edinburgh Worldwide Investment Trust.
“The magnitude of this value destruction in peer UK equity investment trusts over this period is unprecedented,” Weinstein wrote.
The trust had total assets of £847.15 million ($1.1 billion) as of 31 October.
Now the high-profile activist investor is calling for a general meeting to appoint a new board consisting of only “qualified, independent directors … committed to delivering long-term value for all shareholders.”
“We are deeply disappointed by the board’s prolonged intransigence,” Weinstein wrote in the letter Thursday. “We are not confident in the current board’s ability to implement the necessary strategic changes.”
The move follows an earlier attempt by Saba last year to shake up EWI Trust’s board, a bid that ultimately failed to win investor support.
Weinstein – whose New York-based $6 billion hedge fund trades credit-related value opportunities – has recently built a number of positions across the UK investment trust space.
outline Two new bets At the annual Sohn London investment conference last week, he said a “storm is brewing” in the UK investment trust sector where discounts have widened sharply.
EWIT is expected to issue a statement later Thursday. Bailey Gifford declined to comment on the matter.