Home / Business and Economy / US Raider Targets Herald Trust: Existential Threat Looms
US Raider Targets Herald Trust: Existential Threat Looms
24 Feb
Summary
- Herald Trust raises alarm with City watchdog over US raider's actions.
- Saba Capital holds 31% of Herald, aiming for effective control.
- Saba blocked a share buy-back offer, threatening Herald's existence.
Herald, an investment trust, has formally alerted the Financial Conduct Authority to concerns regarding Saba Capital, a US-based entity. Saba Capital currently possesses 31% of Herald's shares, a stake Chairman Andrew Joy believes is intended to gain effective control through attrition. Joy expressed apprehension that Saba might seek to replace the current board with its own nominees, who would then likely appoint Saba as the investment manager.
This conflict has overshadowed Herald's past year, as stated by investment manager Katie Potts. A recent attempt by Herald to offer investors a chance to sell shares at asset value was blocked by Saba Capital, which held an effective veto due to its significant shareholding. This move has placed Herald's existence under severe threat.
If no alternative solution emerges, Herald may be compelled to implement a similar offer requiring only a simple majority for approval. This action would likely signal the end of the company's current mandate and management structure. The Financial Conduct Authority has acknowledged awareness of these concerns.
