Weinstein & Saba’s Campaign Hits UK Investment Trusts: Demands, Pushback & Stakes

Boaz Weinstein’s Saba Capital is behind one of the most significant activist investor campaigns in recent UK investment trust history. The initiative targets seven closed-ended trusts—Baillie Gifford US Growth, Edinburgh Worldwide, CQS Natural Resources Growth & Income, European Smaller Companies Trust, Henderson Opportunities, Herald Investment Trust, and Keystone Positive Change—for sweeping governance overhaul. Saba has taken sizeable stakes (19-29%) in each trust and aims to reconstitute their boards, replace management, alter investment mandates (favoring UK trusts and correcting NAV discounts), and consolidate portfolios under its control [4][10][3].

However, these proposals have met resolute resistance. In the first of these trusts, Herald, shareholders rejected Saba’s resolutions by wide margins—65% against, which excludes Saba’s own share votes drops support to near negligible levels [2][10][11]. Similar results followed in other trusts, marking a clean defeat across all votes[10]. Critics, including trust boards and retail investors, have labelled Saba’s proposals as aggressive, opportunistic, and lacking in sufficient roadmap—citing absent detail on fee arrangements, prospective portfolio shifts, and how governance structures would be preserved for minority shareholders in the newly proposed model [12][13][14].

Regulatory and industry bodies have also intervened. The Association of Investment Companies (AIC) has formally raised concerns with the Financial Conduct Authority (FCA) to ensure retail investors’ interests are protected under the Consumer Duty, demanding greater disclosure, board independence, and clarity on conflicts of interest under Saba’s proposals [12]. Meanwhile, industry commentators argue that the broader UK investment trust sector may be vulnerable if oversight isn’t adapted to account for sophisticated activism strategies using stakes and proxy battles [1][4].

Strategically, the campaign highlights several shifts: a rise in retail engagement and voting turnout among small shareholders; pressures on traditional trust structures; and potential regulatory evolution to sharpen oversight of activist campaigns. For Weinstein and Saba, the failures to win control thus far suggest their political case has not persuaded the majority of investors, raising fundamental questions about how activist investors can—or should—reshape institutional fund vehicles. The economic drivers are clear: deals (tenders, buybacks, open-end conversions) offered wins when successful; but defining long-term commitments and avoiding conflicts has proved difficult.