I am not buying anything. Trump Turriffs but a fearful escalation in the Ukraine US conflict. |
Discount widening is an opportunity to buy e. I like it! |
Hi, not a holder but have been an admirer of Herald over the years.Has anyone done research on Saba's IT investments, as I have 4 questions:-do you think has made a profit yet?-are they borrowing money, if so how can they last?-has there been any benefit to ordinary investors?-how are they going to exit?Won't shed any tears if they lose money. |
Well if shareholders hadn’t voted against the proposals they would have had the discount disappear - as it stands shareholders have cost themselves hundreds of millions across the several trusts. |
Herald Investment Trust plc
Annual Financial Report
For the year ended 31 December 2024
Results and dividend
"The net asset value ('NAV') of the Company as at 31 December 2024 was 2,488.2p per ordinary share (2023 - 2,219.2p). This represented an increase of 12.1% during the year, compared to an increase in the comparative total return indices of 5.0% for the Deutsche Numis Smaller Companies plus AIM (ex. investment companies) Index and an increase of 25.9% for the Russell 2000® Technology Index (small cap) (in sterling terms). The discount at year end was 2.3% (2023 - 13.4%).
The directors do not recommend a dividend for the year ended 31 December 2024 (2023 - nil) as the revenue reserve is in deficit." |
An outstanding final report full of useful data and well done to Herald for resisting the unwelcome Saba takeover attemptIf there's one thing I would like to see it's a narrowing of the discount |
This is more of a generic article on Saba and the challenges of voting on various platforms (goodness knows which one he uses but it sounds awful) but it's short and there are a few pieces that are directly about HRI about 2/3 through - future votes coming up, short seller active, .. |
I am still a long term fan of HRI, but Super Micro is doing an Nvidia today, down 12%. |
I had a small holding which i sold out slightly above NAV. Brought back Friday on around 10% discount. Will be interesting to see what Saba do going forward. Fairly sure will need to wait 6 or 12 months between demanding another compulsory vote, as an outside minority shareholder. |
I hadn't thought of that. Probably needs a Regulation to stop this nonsense happening. |
They actually phoned me as well as sending a letter. |
...If so, would it be possible at some point for HRI shareholders to get together and carry out a class action against SABA, claiming for damages to our financial interests?
I just don't know. |
They are not about to win a popular vote anytime soon in HRI but they aren’t going away. So which directors are up for re election at the next AGM. I have no idea but with these kind of less dramatic votes and a very low turnout they could easily take control by stealth over time. If they nominate directors at the AGM will everyone still turnout to vote them down. There is absolutely nothing to stop them calling another EGM today and another after that if it fails. It’s a no cost free hit. Will they simply win by attrition? |
amt - I'm not sure the outcome in some of the other trusts will be quite as emphatic.
I also own ESCT, once of Saba's targets, through a platform, and have heard nothing from the company. In contrast HRI has been on media, and sent a snail mail letter to advise me on how and why to vote. HRI also has a strong loyalty based on years of track record. So I think the response here would be stronger than ESCT |
Could SABA make a bid. If they did then it would need to be at a good premium. Then they would need to sell underlying assets which would cause those underlying investments to fall in price.
If they now sell their shares the share price will fall.
Either way I can't see a way that SABA can make a return here other than sitting tight and relying on current managers to continue with their existing strategy. |
Judging by the outcome here it's unlikely they will succeed with the other trusts.
It's a pity Saba are not forced to pay for all the admin costs involved. |
 Maybe the recent return to share price weakness was the result of investors not wishing to be in the stock if Saba won the vote, coupled with Saba stopping buying?
I think this trust is pretty unique in the investing universe, as a technology focused pooled investment that doesn't focus on the big names in the US. So that's one positive for Saba not being successful, as they had made clear that they would amalgamate the trusts they control - the 7 (initial) targets have very different investment mandates.
I also feel that it's a great shake up for the whole sector - communication with retail shareholders will probably improve, platforms are likely to be more proactive in notifying and engaging retail shareholders in votes (though if H-L is true to its recent performance with notifications, the notification will probably after the deadline), boards will have to put a bit more energy into closing discount, or attracting other investors.
There's probably more in that list.
But your question on "what will Saba do next" is on for which i'm sure many investors are waiting. Perhaps it will depend on whether they are successful in votes for any, some, or all but this one |
As a former HRI holder I have watched this saga with great interest especially as several ITs are and could be involved. There are too many trust peristently trading at wide discounts.
My first instinct was it was a good move. The activism closed up a 10% discount, and Boaz has a point some boards look pretty weak. Obviously as awareness grew of majority votes against the discount has returned. How has this No vote been good for investors then, unless perhaps you took advantage to trade the cycle?
What will Saba do next? |
I expect we will see a substantial fall in the share price in the weeks and months ahead as SABA sell out and then normal activity can continue. I expect SABA will make a substantial loss from their ill advised venture. |
I hope SABA will pay for all the admin |
Andrew Joy, Chairman of Herald Investment Trust plc, said:
"Today non-Saba shareholders have almost unanimously rejected Saba's self-interested proposals.
The fact that 99.78% of all votes cast by non-Saba shareholders were voted against Saba's resolutions and in favour of the existing Board provides a clear, complete and incontrovertible rebuttal of Saba's attempt to take control of your company and change its strategy against the wishes and interests of its non-Saba shareholders.(1) (2)
The votes against Saba's proposals were supported by independent proxy advisers including Glass Lewis and ISS. It is perfectly clear that the reason Saba's proposals were rejected is that they were intended to lead to an outcome, namely Saba managing Herald, which the existing shareholders were simply not interested in. The reason shareholders invested, and continue to invest, in Herald is for long-term capital appreciation through investing in smaller technology companies, and they do not wish to be deprived of the opportunity to enjoy more of the same. They did not invest in Herald to become part of a short-term trading strategy.
I would like to thank all Herald's shareholders, both large and small, for their support. I very much regret that this episode has already cost shareholders money, which unfortunately we cannot reclaim from Saba. We look forward to engaging with our shareholders, including Saba, now that our shareholders have voted resoundingly in favour of the Board and by extension, the mandate and the Manager.
The Board will be taking advice from our advisers on the next steps. Shareholders have voted overwhelmingly to continue with what has been a unique and highly successful strategy, and we look forward to discussing future developments further with them.
We are well aware of the environment in which investment companies operate and the need to have regard for creating value not just by multi-year patient growth in NAV, which to remind people, has enabled a 27x NAV total return(2) since launch in 1994, but also by ensuring that capital allocation is optimised, again for the long term. As evidence, Herald has bought back its own shares every year since 2007, including approximately 10% of the Company's share capital in each of the last two years. The Company has only ever issued £95m of stock and has bought back over £465m already, and still has net assets of £1.2bn. The Board, working with the Manager, will continue to be alive to the best use of the Company's funds at any particular time."
All of the Requisitioned Resolutions were voted on by way of a poll and the results are shown in the table below. |
hxxps://citywire.com/funds-insider/news/saba-loses-first-vote-against-herald-investment-trust/a2458241 |
It's on the London South East forum |
HRI win, I believe |
amt - where did you see results please? |
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