Baillie Gifford Trust Chief Urges Shareholders to Reject Activist Investor
Tom Burnet, chair of the Baillie Gifford US Growth Trust, is rallying investors to vote against Saba Capital Management's bid to replace board members, citing concerns over independence and self-interest.
Tom Burnet, the chairman of the Baillie Gifford US Growth Trust, has implored shareholders to decisively reject the advances of activist hedge fund Saba Capital Management in an upcoming vote. Burnet described Saba's efforts to replace board members and install its own directors as an 'existential' threat to the trust, which holds investments in companies like Anthropic, Open AI, and SpaceX.
Saba, led by billionaire Boaz Weinstein, has accumulated a 29 percent stake in the trust, falling just short of the threshold that would trigger a mandatory takeover bid. This latest move follows a previous attempt by Saba to gain control last year, which was thwarted by shareholders. Adding to the pressure, another New York-based hedge fund, Sessa Capital, recently increased its holding to nearly eight percent.
Burnet, in comments to the Mail on Sunday, expressed a strong desire to defeat Weinstein, stating, "I don’t just want to win this, I want to thump him." He further emphasized his goal of securing a significant victory, adding, "I want to absolutely win it with blue water between us and them."
The trust is urging shareholders to vote against Saba's proposals, arguing that such changes would undermine the board's independence and serve the hedge fund's own agenda. With retail investors holding over half of the trust's shares, their votes are expected to be crucial in determining the outcome.
Amit Vedhara of the campaign group ShareSoc commented that Saba's strategy attempts to "grab control of the trust via a back door strategy that usurps the board." He stressed the importance of shareholder participation in the vote. The deadline for shareholders to cast their votes via investment platforms is October 14.
Weinstein has a history of targeting investment trusts, with varied success. He has previously characterized his activism as a fight against what he perceives as the sector's tendency for trusts to trade at a discount to their underlying asset value. Saba Capital Management was contacted for comment.