Baillie Gifford U.S. Growth Trust Fights Back Against Activist Investor
Strong Performance Data Released
In a bold move to counter activist investor Saba Capital’s plans to shake up its board, Baillie Gifford U.S. Growth Trust has unveiled impressive performance data for the six months ending November 30. The trust’s share price and net asset value (NAV) returned a remarkable 40.9% and 29.4%, respectively, outperforming the S&P 500 Index in sterling terms.
A Response to Allegations of Underperformance
Saba Capital, founded by Wall Street veteran Boaz Weinstein, had accused Baillie Gifford of consistent underperformance. However, the trust’s latest data tells a different story. By deducting borrowings at fair value, Baillie Gifford’s returns far surpass the S&P 500 Index’s total return of 15.3% in sterling terms.
A “Self-Serving and Destructive” Attempt
Baillie Gifford has dismissed Saba’s proposals to place two of its nominees on the board as a “self-serving and destructive” attempt to assume control of the company. Saba’s plans aim to overhaul the boards of seven trusts, citing performances ranging from “underwhelming” to “disastrous”.
A Long-Term Track Record of Success
From its 2013 launch to November 30, Baillie Gifford’s share price and NAV returned an impressive 169.7% and 186.1%, respectively. While this falls slightly short of the S&P 500 Index’s total return of 190.5% in sterling terms, it demonstrates the trust’s long-term commitment to delivering value to its investors.
Independent Proxy Advisor Weighs In
Glass Lewis, a leading independent proxy advisor, has recommended that shareholders vote against Saba’s proposals at a meeting on February 3. Glass Lewis cited a “lack of detail” in Saba’s campaign, suggesting that it is more focused on obtaining influence than offering shareholders a timely and certain exit.
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