Record number of Hargreaves Lansdown customers vote in trust battle

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A record number of shareholders voted through Hargreaves Lansdowne in the battle between US workers Saba Capital and seven UK investment trusts.

The UK’s largest direct-to-consumer investment site said it had experienced an unprecedented level of turnout among investment trust shareholders as they gave their views on Saba’s proposal to overturn trust boards.

Hargreaves Lansdowne said 41 percent of its clients, which hold Herald Investment Trust, voted. Saba Vote lost this week

The turnout will allay concerns that individual shareholders, who are less engaged than professional investors, will not turn out to vote.

Saba’s effort to replace the boards of seven trusts with its own recommended candidates represents one of the largest shake-ups of the 150-year-old investment trust industry, which manages about $260 billion.

Saba founder Boaz Weinstein said the hedge fund, if successful, would put itself forward to run the trusts to replace existing directors Herald, Janus Henderson, Manulife and Bailey Gifford.

Hargreaves Lansdowne said almost one in two of its clients supporting the European Small Firms Trust, run by Janus Henderson, had so far voted.

The investment site adds a record of voting levels for each trust. Other trusts include Keystone Positive Change, Bailey Gifford US Growth, Henderson Opportunities, CQS Natural Resources Growth & Income and Edinburgh Worldwide Investment Trust.

“We’ve seen a significantly higher proportion of client voting than usual as a result of our campaign to actively inform clients,” said Emma Wall, head of platform investments at Hargreaves Lansdowne.

“While this is something to celebrate, we urge those of us who have not yet voted to do so, as it is really important that they exercise their right to vote. Shareholder rights are one of the key advantages of investment trust structures. He added that the deadline for voting on the five trusts is the end of January.

Investment trusts are closed-ended funds and their shares trade on the London Stock Exchange. However, share prices have tended to lag the trust’s net asset value in recent years, shining the Weinstein spotlight.

The average investment trust’s discount stands at about 15 percent, according to the Association of Investment Firms. The broad average discount since the financial crisis was recorded at about 19 percent in October 2023.

Sabah needs more than 50 percent of the votes cast for each trust to win.