In another decisive activist move, Saba Capital, led by Boaz Weinstein, has blocked the proposed merger of two Baillie Gifford–managed London-listed investment trusts:
- Baillie Gifford US Growth Trust (USAB)
- Edinburgh Worldwide Investment Trust (EWIT)
Saba, the largest shareholder in both vehicles (holding 28% of USAB and 25% of EWIT), declined to support a merger that would have given shareholders a cash exit of up to 40% and created a larger U.S.-focused mandate under Baillie Gifford.
🔍 Why It Matters
This veto is the latest escalation in Saba’s campaign targeting underperforming UK-listed investment trusts. Earlier this year, Saba launched actions against seven trusts, arguing structural underperformance and calling for:
- Mergers of weaker vehicles
- Share buybacks
- Increased exposure to private assets
- Board changes to prioritize shareholder value
Trust boards, however, say Saba’s objectives are self-serving, while Weinstein argues he is pushing for better returns and governance for all investors.
🔄 What Happens Next
EWIT confirmed it will continue discussions with Saba in hopes of resuscitating the merger plan.
But tensions are rising.
Baillie Gifford US Growth Trust Chair Tom Burnet criticized the hedge fund’s move:
“We are highly disappointed that Saba has once again impeded other shareholders by blocking a materially improved opportunity.”
📉 Broader Implications
This clash underscores a growing wave of activist pressure on the UK’s £260B investment trust sector — one that could reshape:
- governance dynamics
- discount-to-NAV management
- trust consolidation trends
With Saba’s influence expanding, more boards may be forced into strategic reviews, mergers, or structural reforms.