Good morning investment trust investors,  

Contents

1. Overview for the week
2. Frostrow Retail Investor Events
3. Investment Themes
4. Sector data for the week

1. Overview for the week

Nothing to see here, we are seemingly back to ‘risk on’ in the markets now. We are looking at 15 straight days of FTSE 100 rises and 9 days for the S&P 500 Index (at time of writing). We started the week with massive power cuts across Spain and Portugal with nothing working from trains, planes, traffic lights, or even beers on tap. No one really knows what caused it, with some news articles suggesting a “rare atmospheric phenomenon”. That sounds rather fishy to me and the speed with which the authorities said that this was also not caused by “cyber-attack” makes me think twice about that also. I’m pretty sure top executives at M&S, Co-op and Harrods would be sceptical about that also. Still, the US and Ukraine have finally signed their minerals deal this week and it seems that the latest leg of the market rebound has been a positive interpretation of China’s statement that they are seemingly considering engaging in trade talks with the US, as well as the US employment data for April. In Canada, Mark Carney won the election for the Liberals, coming from being significantly behind in the polls, no doubt courtesy of attitudes there towards The Donald. In the US, Trump has marked his first 100 days in office as a “revolution of common sense” at the same time as the US economy has contracted by 0.3% in Q1. In the UK, Reform have taken Labour’s 16th safest seat in local elections and others and look set to upset the traditional dominance of the two-party system in the UK in the weeks ahead.

The investment trust sector continues its daily grind to bring back the equilibrium between demand (from investors) and supply (of product / shares in issue) as ETFs continue to be the dominant fund structure on platforms. The average sector rating (ex 3i Group) remains historically wide but contracted from circa 15.2% to 14.5%. We continue to see a very high number of share buyback announcements taking place daily as well as other activity to help with discount control, general de-leveraging and proof statements around the use of the closed ended structure. And that is why the sector has been a successful structure for investors for over 150 years. One would hope that the UK Government have read the fascinating article in this week’s Economist: “The risky world of private assets opens up to retail investors.” Why? With the amount of money surging in private assets globally over the last decade from $10 trillion to $24 trillion today, and groups like Apollo saying US retail clients are their biggest opportunity (to sell private assets to, in ETFs), the investment trust sector exists here and remains ideal to house such assets. The SEC concerns expressed in the article tell you all you need to know. When someone at the top of the tree wakes up and understands that, the investment trust sector will be recognised for what it is – a leading UK industry with enormous potential knock-on effects to multiple other sectors, whilst at the same time providing significant opportunity for real returns for investors over time. When the ‘biting point’ is found again for that equilibrium in the UK investment trust sector, then folks you want to be owning shares in some trusts. Will we see more vehicles like Middlefield Canadian change their structure to an ETF (see below)? Perhaps if the fund concerned is not using the closed ended structure sufficiently, but for funds investing in private assets, very doubtful.

2. Frostrow Retail Investor Events

Augmentum Fintech (AUGM LN, Financials & Financial Innovation, £134.8m mkt capn, 50.9% discount to NAV):  The latest Frostrow webinar is available to see on You Tube.

https://www.youtube.com/channel/UCAptpfmx0HITqvlI68psd7Q

Aurora UK Alpha (ARR LN, UK All Companies, £284.1m mkt capn, 7.7% discount to NAV): The last webinar was recorded on 20 January 2025 and is available on the following link: 

https://www.youtube.com/watch?v=0hl0yNZgRlM

A recent article from UK Investor Magazine to read also:

https://ukinvestormagazine.co.uk/aurora-uk-alpha-the-north-star-of-intrinsic-value/

Biotech Growth Trust (BIOG LN, Biotechnology & Healthcare, £206.1m mkt cap, 5.8% discount to NAV): the latest webinar took place at 3pm UK on Tuesday 25 February 2025. You can hear the recording on the following link:

https://www.youtube.com/watch?v=wxOUIC0oT5s

CC Japan Income & Growth Trust (CCJI LN, Japan, £245.9m mkt capn, 6.8% discount to NAV): The last webinar was recorded on 22 January 2025 and is available on the following link: 

https://www.youtube.com/watch?v=MmbViKRnsdA

CQS Natural Resources Growth & Income (CYN LN, Commodities & Natural Resources, £121.9m mkt capn, 4.3% discount to NAV):  Please see the link to the last webinar on 4 November 2024:

https://www.youtube.com/watch?v=dhSC3wNKLxM

Custodian Property Income REIT (CREI LN, Property UK Commercial, £339.9m mkt capn, 20.8% discount to NAV):  In addition, the last webinar was recorded in January 2025 and is available on the following link:

https://www.youtube.com/watch?v=Qd1-ciXoC2o

Ecofin Global Utilities (EGL LN, Infrastructure Securities, £209.0m mkt capn, 11.3% discount to NAV) : Jean-Hugues de laMaze, lead manager of the Trust presented at a webinar with Frostrow on Wednesday 23 April 2025. The link to the recording will be available on the link below:

https://www.youtube.com/watch?v=lVkYbR67ecE

Finsbury Growth & Income Trust (FGT LN, UK Equity Income, £1,304.0m mkt capn, 7.0% discount to NAV): Nick Train’s AGM presentation was recorded and is available to view on the Frostrow You Tube page. Click the link here to see it, it is worth a view:

https://www.youtube.com/watch?v=yE9HV__Iwlc

There is also a good “insider interview” from Interactive Investor as Nick explains the “generational” opportunity to buy UK growth firms

https://www.ii.co.uk/analysis-commentary/nick-train-generational-opportunity-buy-uk-growth-firms-ii534473

MIGO Opportunities Trust (MIGO LN, Flexible Investment, £63.4m mkt capn, 4.0% discount to NAV): Following on from the HY results release, Nick Greenwood and Charlotte Cuthbertson presented on a webinar at 11am on 24 January 2025. This one stop shop is a great way to play the discounts on offer generally in the listed fund sector. The recording can be accessed on Frostrow’s You Tube page here:

https://www.youtube.com/watch?v=XuSoFuNKSXk

Mobius Investment Trust (MMIT LN, Global Emerging Markets, £143.1m mkt capn, 5.9% discount to NAV): Carlos Hardenberg, lead manager, recently presented on a webinar. Please see below the link to the recording: 

https://www.youtube.com/watch?v=sMBNxj6ZD-o

Temple Bar Investment Trust (TMPL LN, UK Equity Income, £843.8m mkt capn, 3.1% discount to NAV): Ian Lance and Nick Purves presented on the trust at a webinar on 18 March 2025. Please do click on the link below to see the recording as well as the link to ‘reflections on current market volatility’ or to hear the Chairman, Richard Wyatt. In addition, note the AGM invitation also at 11:30am on 6 May at Barber-Surgeon’s Hall, Wood Street, London EC2Y 5BL

https://www.youtube.com/watch?v=wkaifQndXaQ

https://www.templebarinvestments.co.uk/media/insights/reflections-current-market-volatility/

https://www.investormeetcompany.com/updates/an-update-from-the-chairman/show

Worldwide Healthcare Trust (WWH LN, Biotechnology & Healthcare, £1,447.2m mkt capn, 10.4% discount to NAV): Sven Borho and Trevor Polischuk recently completed the latest webinar overview (November 2024). See the Frostrow You tube page for the recording. 

https://www.youtube.com/watch?v=tppMeH6W9Zo

In addition, if you did not make the 30-year anniversary event this week and you would like a copy of the presentation, please contact Frostrow

Frostrow Investor Relations team – Messrs Grant Challis, Neil Winward, Matt Burrows, Matt Norfolk-Clarke & Nicholas Todd

Please contact us on ir@frostrow.com

Trump is doing his best to re-set the world trade order and in so doing will potentially re-set the investment landscape. What has worked for the last few years (ie US Equity trackers, passive investments and short dated bonds) will not necessarily be the best idea in the coming periods. The investment trust sector in the UK represents one third of the FTSE 250 Index and half of the FTSE Small Cap Index. There are highly valuable listed fund vehicles using the structure appropriately available to use for savings and investment today, as there have been for the last 150 + years.

Find us on the web:  https://www.frostrow.com/

Find us on You Tube:  https://www.youtube.com/channel/UCAptpfmx0HITqvlI68psd7Q

Check out our April 2025 summary podcast also, released earlier this week: FROSTROW CAPITAL - Frostrow Talks Trusts - AI Podcast - InvestorMeetCompany

Frostrow Capital, bringing you high quality, differentiated product in a UK listed closed-ended form

3. Further investment themes evident in the investment trust sector this week include:

Discount Control

JPMorgan European Discovery (JEDT LN, European Smaller Companies, £531.3m mkt capn, 7.8% discount to NAV): seeking to replenish share buyback authority as it may be fully utilised before the next AGM. "As a result, in order to ensure that the Company can continue to effectively operate its discount management policy, the Board is seeking Shareholder approval for the early renewal of its authority to repurchase Ordinary Shares."

Vietnam Enterprise Investments Limited FY results to 31 December 2024 (VEIL LN, Country Specialist, £941.2m mkt capn, 20.3% discount to NAV): NAV TR +14.3% vs Vietnam Index +10.8%; share price TR +9.9% (discount widened); " In 2024, the Company repurchased 16.3 million shares, representing 8.1% of the weighted average number of Shares Outstanding, at a total cost of US$121mn. This was a more than threefold increase from the previous year and significantly above the rise in buybacks across the investment trust industry as a whole. Buying back shares at a discount enhances the NAV of the shares and the estimated uplift to the company's NAV was 1.8%. As part of its commitment to shareholder value, the Board has proposed a five-year performance-related 100% Conditional Tender Offer. This will be triggered if VEIL's net asset value (NAV) total return underperforms its reference index, currently the VN Index, over the period from 31 March 2025 to 31 March 2030. While the Board is confident in the Investment Manager's ability to generate outperformance, this mechanism provides shareholders with the option to realise up to 100% of their holdings should performance fall short. If triggered, the tender offer will be based on NAV less associated costs, ensuring fair treatment for both exiting and continuing shareholders. As at 29 April 2025, the Company had repurchased a further 4.8 million shares, 2.6% of the weighted average number of Shares Outstanding, since year-end."

Artemis UK Future Leaders FY results to 31 January 2025 (AFL LN, UK Smaller Companies, £106.9m mkt capn, 15.2% discount to NAV): NAV TR -2.4% vs Deutsche Numis Smaller Companies + AIM (excluding Investment Companies) Index +7.8%; share price TR -8.0%; changed management from Invesco to Artemis due to the Board being unhappy with performance. "... begun to trade on a discount of over 10% and therefore, on 22 May 2024, the Board announced a proposed elective return of capital to be offered to all shareholders in respect of up to 10% of the Company’s issued shares (excluding treasury shares), and at a 2.5% discount to net asset value...The special dividend was paid on 8 October 2024, resulting in 3,382,648 shares being cancelled for no consideration pursuant to the reduction of capital and an amount of £16,401,000 was paid to Shareholders who elected to receive the special dividend." "During the last year, your Company has traded at a persistent discount of over 10% and one of the Board and managers’ objectives is to reduce this so it is closer to net asset value."

Mid Wynd International IT (MWY LN, Global, £310.0m mkt capn, 1% discount to NAV): publishes a circular in regard to its share buyback programme to buyback shares at a discount of no wider than 2%. Shareholder authority will be sought to cancel the share premium account "to carry out further share buybacks and/or pay dividends". "In addition, to avoid a situation arising whereby the Company fully utilises its authority to buy back shares pursuant to the DCM prior to this year's annual general meeting which is expected to be held in October 2025, Shareholder authority will also be sought for the early renewal of the Company's authority to buy back shares."

M&A news

Warehouse REIT (WHR LN, Property UK Logistics, £461.4m mkt capn, 15.0% discount to NAV) has been granted a PUSU deadline extension in relation to the indicative non-binding proposal from Blackstone Europe LLP from 1700 BST today (28 April 2025) to 1700 BST on 12 May 2025.

Harmony Energy Income Trust (HEIT LN, Renewable Energy Infrastructure, £218.0m mkt capn, 3.9% premium to NAV) announced the irrevocable Schroders had signed (in respect of 37.3m shares) in relation to the Drax (DRX LN) bid has lapsed.

Care REIT (CRT LN, Property UK Healthcare, £445.9m mkt capn, 13.1% discount to NAV) CareTrust REIT Inc announce Q1 2025 results and say "We are thrilled to announce our proposed strategic acquisition of Care REIT in London received Care REIT shareholder approval on April 29, 2025. We expect to officially close on or around May 9, 2025, after approval by the English Court. We believe this acquisition makes CareTrust stronger in many ways on day one: portfolio diversification, scale, and a new growth engine for years to come.”

Saba update

Middlefield Canadian Income (MCT LN, North America, £123.7m mkt capn, 6.4% discount to NAV): announce "the voluntary winding up of the Company" with shareholders having "the option to receive shares in a newly established, actively managed, listed and London Stock Exchange traded fund in the form of an authorised UCITS" (ETF). "The ETF would be managed by Middlefield Limited, the Company’s investment manager (“Middlefield”) and would offer continued exposure to the Company’s existing investment objective and policy. Advisory work on the structure of the Transaction is ongoing, and the Company will release an announcement with further details in due course." Shareholders will be able "to participate in an uncapped cash exit at close to the Company’s net asset value per share or elect to receive a combination of both shares in the ETF and cash." (This is all post a requisition notice from Saba Capital in February). Circular in regard to the transaction likely available by August 2025

Capital allocation update

Literacy Capital (BOOK LN, Private Equity, £237.6m mkt capn, 22.6% discount to NAV) NAV as at 31 March 2025: +3.8% over calendar Q1 2025 to 511.5pps; BOOK deployed £7.4m of capital during the period and refinanced two companies returning £5.6m to BOOK. "We are disappointed by the share price return in 2025 to date, which we do not feel is reflective of the Company's progress. The two new investments that were completed recently were an attractive use of BOOK's capital, whilst liquidity also has to be retained to support portfolio companies as required. However, buybacks remain an option, if additional marketing efforts do not reduce the current discount and this is considered the best use of the Company's capital."

GCP Infrastructure Investments March NAV (GCP LN, Infrastructure, £603.0m mkt capn, 31.1% discount to NAV): The Company's Board of Directors ("the Board") reconfirms their commitment to the Company's capital allocation policy set out in the 2024 Annual Report and Accounts, continuing to prioritise further reduction in leverage, as well as reducing equity-like exposures and exposures in certain sectors, whilst also facilitating the return of £50 million of capital to shareholders. At 31 March 2025, the Company had £41 million (31 December 2024: £61 million) outstanding under its revolving credit arrangements, representing a net debt position of £29 million (31 December 2024: £43 million) which compares to the Company's unaudited NAV of £872 million (31 December 2024: £911 million). As announced on 30 January 2025 and in line with the Company's capital allocation policy, during the period the Company disposed of its interest in two operational onshore wind farms, generating day one cash proceeds of £16.5 million. NAV 102.28p; "Further supporting the capital allocation policy, the Company bought back 13,610,093 ordinary shares in the quarter, contributing a 0.49 pence per ordinary share increase to NAV."

Strategic review update

CQS Natural Resources (CYN LN, Commodities & Natural Resources, £121.9m mkt capn, 4.3% discount to NAV) has confirmed its “previously disclosed strategic review remains ongoing… [and] the company expects to announce its recommendations regarding the proposals by 31 May 2025.”

Conversion opportunity

abrdn Asia Focus (AAS LN, Asia Pacific Smaller Companies, £415.3m mkt capn, 12.9% discount to NAV): holders of 2.25% convertible unsecured loan stock 2025 (CULS 2025) have the right to convert their holding into Ordinary shares "at any time during the period of 28 days ending on 31 May 2025". Conversion price of 293p

Gearing news

SEGRO plc (SGRO LN, £9,320m mkt capn) was affirmed BBB+ with a Stable outlook by ratings agency Fitch.; Subsequently announced trading update for calendar Q1 2025: “Strong performance from the existing portfolio and growth in active development pipeline, with ongoing pre-let negotiations across key markets.” “£13m of new headline rent signed, the majority of which came from the existing portfolio, with a 37% uplift from UK rent reviews and renewals.” “Balance sheet remains strong with a LTV of 29% and £2.2bn of cash and undrawn committed facilities.” Separately, the company has announced CFO Soumen Das will retire and “a process has commenced to identify his successor and a further announcement confirming board succession arrangements will be made in due course.”

NewRiver REIT (NRR LN, £359.2m mkt capn) FY trading update for period to 31 March 2025: "Transformational acquisition of Capital & Regional completed in December 2024." “FY25 UFFO and EPRA NTA expected to be in-line with analyst consensus.” “Another strong operational quarter with increased occupancy and excellent leasing performance during Q4; LTV at c.42%, in-line with post Capital & Regional acquisition proforma; to reduce to within NRR guidance of ‹40% with modest disposals.”

Templeton Emerging Markets (TEM LN, Global Emerging Markets, £1,699.6m mkt capn, 12.4% discount to NAV) announced it has drawn down CNH300m for one month under its existing £122m multi-currency RCF, repaying £40m of the £80 currently drawn at the same time. As at 30 April, TEM’s net gearing position was 0%, net of cash in portfolio.

Supermarket Income REIT (SUPR LN, Property UK Commercial, £974.6m mkt capn, 11.2% discount to NAV) has refinanced its existing secured debt facilities with a new £90m unsecured debt facility with Barclays. “The interest-only facility has a maturity of three years, with two one-year extension options at the lender's discretion and is priced at a margin of 1.55% above SONIA.” "Following the debt refinancing and completion of the recently announced joint venture, the Company has an expected pro-forma LTV of c.31%."

Picton Property Income (PCTN LN, £406.4m mkt capn): completed a new £50m RCF with NatWest Bank. "The RCF, which was due to mature on 26 May 2025, has been refinanced with an initial term of three years and the option of two one-year extensions. Interest is charged at a margin of 165 bps above SONIA, on the first £25 million, and 170 bps thereafter. An undrawn commitment fee is payable equal to 40% of the margin. The RCF is undrawn and the remainder of the Company's borrowings of £210 million are fixed at an average interest rate of 3.7% per annum with the earliest maturity in 2031."

Results / updates

NB Private Equity Partners (NBPE/U LN, Private Equity, £654.8m mkt capn, 34.9% discount to NAV) FY2024 results to 31 December 2024: NAV TR +1.5% to $27.53 (2198pps). “Strong portfolio company operating performance: LTM revenue and EBITDA growth of 8.0% and 13.1%, respectively, during 2024… $179m of proceeds from realisations received during 2024.” NAV as at 31 March 2025: $27.17 (2105pps) as positive FX YTD has been offset by declines in quoted holdings – this NAV “does not include any Q1 2025 private company valuations.” $47m of realisations received during calendar Q1 2025 driven by” full exits of USI and Kyobo Life Insurance, [and] partial realisations of Tendam, Qpark, Clearent, and Osaic.” "NBPE ended the year in a strong financial position with $283 million of available liquidity and an investment level of 102%, which is at the lower end of the long-term target investment level range of 100-110%". "Through 25 April 2025, NBPE has repurchased approximately 624k shares for $12.3 million at a weighted average discount of 29%, resulting in a NAV accretion of approximately $0.10 per share"

Fidelity Special Value FY results to 28 February 2025 (FSV LN, UK All Companies, £1,087.1m mkt capn, 4.7% discount to NAV): NAV TR +1.8% vs FTSE All Share Index +5.2%; share price TR +5.2%; "The Company’s NAV underperformance against the Benchmark was primarily due to the significant performance divergence between large and mid-cap stocks in the UK market." Net gearing increased from 7.9% to 10.9%. "The unpopularity of the UK market has made it an attractive hunting ground for contrarian value investors. We believe that the combination of favourable valuations and the large divergence in performance between different markets provides a strong opportunity for attractive returns on a three-to-five-year view."

M&G Credit Income Quarter end 31 March 2025 (MGCI LN, Debt – Loans & Bonds, £161.2m mkt capn, 3.0% premium to NAV): NAV TR +1.4% vs benchmark +2.1%; "We have started to see more daily volatility, with the tariff headlines creating notable uncertainty and the credit markets generally feeling nervous despite remaining orderly. However, the lack of more severe price action during the quarter suggests market participants are still presuming that through negotiations the worst of the tariffs can be avoided and indeed we are far from episodic levels despite the steady bleed wider in credit spreads. Despite the volatility in public bond markets, having come into the year defensively positioned (as we have been for some time on relative value concerns), we were happy to maintain our focus on deploying capital into private assets, investing £7m across 4 assets during the quarter...Should further market volatility give rise to attractive opportunities, we have access to a £25m credit facility and a further £32m invested in two AAA/AA-rated, daily dealing ABS funds, ready to be reallocated."

Pacific Assets Trust FY results to 31 January 2025 (PAC LN, Asia Pacific, £397.8m mkt capn, 12.6% discount to NAV): NAV TR +9.7% vs performance objective of UK CPI + 6% +8.8%; "While this is a good absolute return, which is the Company’s primary objective, the Company lagged the MSCI AC Asia ex Japan Index total return of 22.3%, and the Company’s bespoke peer group of four other trusts and an exchange traded fund." "During the year, the Company repurchased 370,000 shares, at a total cost of £1.4 million, and at an average discount of 14.0%. The Company has continued to buy back shares since the year end and, at the time of writing, had repurchased a further 1,855,000 shares, at a cost of £6.3m, at an average discount of 13.0%. The Board continues to carefully weigh up the circumstances in which the Company should buy back shares in the market. We have been conscious that share buybacks have their drawbacks and are not always effective, but we are prepared to take action when the discount widens materially." "David Gait has ably led the Company’s investment management team since Stewart Investors’ appointment 15 years ago, with Douglas Ledingham as the co-manager for almost seven years. It has been agreed that, with effect from 1st July 2025, David will hand over the lead portfolio manager role to Douglas whilst continuing to play an integral role as co-portfolio manager (as well as head of the investment team at Stewart Investors)."

PPHE Hotel Group (PPH LN, £518.0m mkt capn) trading update for calendar Q1 2025: total revenue +0.7% YOY to £77.6m with LFL occupancy unchanged and LFL average room rate -3.6% to £134.3 and LFL RevPAR -3.5% to £94.6. Outlook: “forward booking activity levels are positive with overall pace and demand consistent with 2024 levels, albeit there continues to be normalisation in industry room rates.”

HydrogenOne Capital Growth (HGEN LN, Renewable Energy Infrastructure, £26.0m mkt capn, 77.6% discount to NAV) FY2024 results to 31 December 2024: -12.2% over the year to 90.39pps due to the write-downs of HH2E and Thierbach SPV and restructuring of NanoSUN.

AEW UK REIT (AEWU LN, Property UK Commercial, £161.9m mkt capn, 5.8% discount to NAV) Quarterly NAV as at 31 March 2025: TR +1.9% over calendar Q1 2025 to 110.11pps, driven by a +1.42% LFL valuation increase. EPRA EPS 1.71p vs DPS 2p; LTV 25%. "Significant headroom on all loan covenants."

Scottish Oriental Smaller Companies Trust HY results to 28 February 2025 (SST LN, Asia Pacific Smaller Companies, £332.6m mkt capn, 12.4% discount to NAV): NAV TR -1.2% vs MSCI AC Asia ex Japan Small Cap Index £ -5.6%; share price TR +0.1%; shares were split on a 5 for 1 basis in February to "improve the liquidity in and marketability of the Company's shares" Sreevardhan Agarwal assumed responsibility as Lead Manager of Scottish Oriental from 28 November 2024

Third Point Investors (TPOU/S LN, Hedge Funds, £452.2m mkt capn, 15.3% discount to NAV) manager Third Point LLC has published its quarterly investor newsletter for calendar Q1 2025. "-3.7% in the Master Fund during the First Quarter of 2025, versus the -4.3% return of the S&P 500 Total Return Index." "The Investment Manager realized gains earlier in the year through opportunistic sales in Q1 and into Q2 that took its gross and net exposures to multi-year lows and provided dry powder to deploy at the right time."

Wind up news

RM Infrastructure Income (RMII LN, Debt - Direct Lending, £70.9m mkt capn, 14.2% discount to NAV) FY2024 results to 31 December 2024: in managed wind down since December 2023; NAV TR +2.62%... “Good progress has been made over the year on realising the financial assets within the company as the number of loans has decreased from 31 to 17 with invested capital reducing from £101m to £80m over the period.” “A sum of 0.5% will be deducted from cash distributed to shareholders in future Tender Offers and held by RMII until liquidators are appointed and the Board hands over control of the final liquidation process. At that time the monies will be distributed to Directors as decided by Guy Heald, RMII NED, based on the time spent by each director in managing the wind-down process.” "The portfolio is now materially smaller in terms of line items and in overall invested capital size. However, the average loan size has materially increased from £3.2m to £4.3m which means the portfolio has seen a rise in idiosyncratic risk as borrower concentration has risen. We expect the rise in idiosyncratic risk to continue as the portfolio becomes smaller and more concentrated during the managed wind-down process."

Aquila Energy Efficiency Trust (AEET LN, Renewable Energy Infrastructure, £54.6m mkt capn, 21.7% discount to NAV) FY2024 results to 31 December 2024: Been in wind down since AGM 2023; NAV TR -2.7% to 85.55pps. Since period-end, AEET has received proceeds of £23.8m and AEET will make a distribution of £30m and the Board has declared a special interim dividend of 36.837pps in respect of the first six months of the financial year ending 31 December 2025. “The Board intends to continue returning capital to Shareholders, either through the payment of dividends or by means of Tender Offers as soon as sufficient realisation proceeds are received." "Following an extensive asset sale process run on behalf of the Company, by its financial advisors, and which ended in February 2024, the Board has continued to seek and assess opportunities to realise capital through the sale of assets. This remains challenging. As discussed in previous reports, the portfolio consists of assets that are geographically diverse, small in size, contractually complex and many have lengthy maturities of between ten to eighteen years. Furthermore, because of the Managed Run-Off status of the Company, additional complexities have arisen around the realisation of and protection of value in the Company's assets. Our counterparties on some of these investments are aware of the Managed Run-Off position of the Company, and it appears that this is potentially placing us at a disadvantage in certain negotiations/relationships. The Board remains actively involved in negotiating terms to protect the value in the portfolio and continues to work actively with its financial and legal advisers on seeking alternative ways to deliver the return of capital to our Shareholders."

GCP Asset Backed Income (GABI LN, Debt – Direct Lending, £139.3m mkt capn, 21.5% discount to NAV) FY2024 results to 31 December 2024: managed wind down since May 2024; " Strong progress was made on the Company's managed wind-down. A total of 210.0 million shares redeemed in the year, returning £188.2 million to shareholders and representing 67.4% of the market capitalisation at 31 December 2023;" NAV -13.9% to 81.8pps, “due to discount rate and fair value adjustments applied to the portfolio.”

Digital 9 Infrastructure FY results to 31 December 2024 (DGI9 LN, Infrastructure, £66.1m mkt capn, 77.8% discount to NAV): NAV TR -56.7% to 34.4pps, driven predominantly by Aqua Comms and EMIC-1, as well as “changes in key assumptions relating to Arqiva.” The directors and (new) manager have “identified potential issues with the prior year valuations… [and] elected to appoint an independent expert to review the valuations for” 2023. "2024 was a year of significant change for the Company, with the appointment of a new board and investment manager, InfraRed Capital Partners Limited ("InfraRed") to effect the managed wind-down of the Company. We believe the Company is in a more stable position, and we have materially progressed the managed wind-down mandated by shareholders last year, with the signed divestments of EMIC-1 and Aqua Comms." "The Board has determined that it is in shareholders' best interests not to publish a full breakdown of the NAV by each portfolio company to protect the Company's commercial position during live divestment processes."

abrdn Property Income Trust (API LN, Property UK Commercial, £21.0m mkt capn, 56.9% discount to NAV) FY2024 results to 31 December 2024: NAV TR -19%... company placed into managed wind-down in May 2024. "...the Board selected a preferred bidder and agreed a transaction with GoldenTree Asset Management (GoldenTree) for the sale of the entire share capital of abrdn Property Holdings Limited (aPH), the wholly owned subsidiary of the Company." "...the current NAV of 8p might imply that the Company could liquidate and distribute that to shareholders. It should be noted however that the current NAV does not reflect ongoing running costs until liquidation and beyond, or final matters relating to the Sales Agreement. Furthermore, there is still considerable uncertainty around the timing and value of the eventual sale of Far Ralia which could impact the size of future distributions. The Investment Manager is actively looking to dispose of Far Ralia and their sole focus, together with the Board, is to maximise the return of capital to shareholders as expeditiously as possible."

ICG-Longbow Senior Secured UK Property Debt Investments (LBOW LN, Property Debt, £27.4m mkt capn, 20.8% discount to NAV) FY results to 31 January 2025 as it is "continuing to progress an orderly realisation of its assets" where "two assets are under offer with the third being prepared for further marketing." "In light of the slow progress of realisations the Board has been focused on controlling costs and during the period negotiated a halving of the Investment Manager's fee rate, which took effect in May 2024. Latterly, the Board have concluded that it is appropriate to reduce the size of the Board itself, with both Stuart Beevor and Fiona Le Poidevin retiring as Directors as at 31 January 2025"

Aquila European Renewables (AERS LN, Renewable Energy Infrastructure, £212.5m mkt capn, 34.4% discount to NAV): in wind down process. The Company "has entered into a sale and purchase agreement with the other shareholders in Sagres, being funds managed and advised by Aquila Capital, for the sale of its 18% interest in the Portuguese hydropower asset" with expected completion by June 2025. "The cash consideration for the Sagres Disposal is approximately EUR 16.5 million, representing the prevailing valuation reflected in the Company's net asset value as at 31 December 2024". "The Board, together with its advisers, continues to work on the divestment of the remainder of the Company's portfolio in accordance with the Company's managed wind-down investment policy, with the aim to deliver the best end result to AERI Shareholders. Whilst the Sagres Disposal is at a valuation in line with the net asset value of the Company's interest in Sagres as at 31 December 2024, prevailing renewable market conditions remain uncertain and dynamic and therefore there can be no guarantee that a similar outcome can be achieved on the sale of the Company's remaining portfolio. The Board looks forward to updating the market further in due course."

Tariff impact

Apax Global Alpha (APAX LN, Private Equity, £573.4m mkt capn, 42.7% discount to NAV) NAV as at 31 March 2025: TR -2.5% over calendar Q1 2025 to €2.38 / 200pps, as “earnings growth from the Private Equity portfolio was largely offset by adverse FX movements, while valuation multiples were generally flat overall.” "We expect 90% of the Private Equity portfolio not to have any first-order impact, with only minor exposure through select consumer and healthcare exposed assets. Second- and third-order tariff impacts are still uncertain and remain too early to assess.” LTM EBITDA growth of 16% in the Private Equity portfolio.

Portfolio news

Patria Private Equity Trust (PPET LN, Private Equity, £862.1m mkt capn, 27.3% discount to NAV) NAV as at 31 March 2025: +0.8% over the month to 786.1pps driven by FX, with PPET receiving £14.9m of distributions vs £9m of drawdowns during the month. PPET “made a further $50m commitment to Patria Secondary Opportunities Fund V” and now has outstanding commitments of £705.3m.

Oakley Capital Investments (OCI LN, Private Equity, £810.1m mkt capn, 34.2% discount to NAV) NAV as at 31 March 2025: TR +2% to 707pps; OCI made £6m of investments during calendar Q1 2025 and allocated €500m to Fund VI. “After nine years as an OCI Board member and Chair Caroline Foulger will not be standing for re-election at the AGM scheduled to take place on 2 September 2025.”

Pershing Square Holdings (PSH/D LN, North America, £6,441.6m mkt capn, 31.7% discount to NAV) manager PSCM extended the terms of its standstill agreement with Howard Hughes Holdings (HHH US) by a further month to 1700 EST on 30 May 2025.

Greencoat Renewables (GRP LN/ID, Renewable Energy Infrastructure, £824.0m mkt capn, 33.4% discount to NAV) has signed a new 10-year PPA with Keppel DC REIT to purchase 100% of electricity generate from GRP’s “Ballincollig wind farm, which has an annual output of 31.5 GWh of renewable energy.” "Since the launch of its re-contracting strategy in December 2023, which focuses on assets transitioning out of tariff regimes, the Company has successfully executed a total of six PPAs for over c540 GWh of energy per annum representing c20% of its 5 year look forward merchant volumes."

Unite Group (UTG LN, £4,250m mkt capn) has entered into a JV agreement with Manchester Metropolitan University for the development of 2,300 new beds for a total development cost of £390m (Unite share: £275m). UTG will “act as developer, asset manager and operator to the JV with 70% ownership share.”

Tetragon Financial Group (TFG NA/LN, Flexible Investment, £1,174.5m mkt capn, 60.2% discount to NAV) NAV as at 31 March 2025: NAV TR +0.5% over the month to $35.38; $0.11 dividend declared in respect of calendar Q1 2025. "Following on from our discussion regarding Equitix in our 2024 Annual Report and in our 14 October 2024 statement regarding press speculation, we note that the continued strong performance of Equitix, as well as other businesses on the platform, has enhanced the attractiveness of individual business transactions and other strategic opportunities as important ways of realising and hopefully accelerating the value inherent in TFG Asset Management. As such, the strategy for TFG Asset Management with respect to Equitix includes continuing to engage with strategic partners and financial advisors to explore options for executing on transactions or partnerships that would take advantage of this value enhancement. Although we do not expect to consummate a transaction with respect to Equitix in the immediate term, our strategy remains unchanged."

Amedeo Air Four Plus (AA4 LN, Leasing, £150.0m mkt capn, 41.9% discount to NAV) published its factsheet for calendar Q1 2025. Asset manager Amedeo has noted the “continuing strength of the aviation and travel markets… supporting demand for used aircraft and therefore lease rates and aircraft values.” “This is all positive for shareholders as we move to within about 18 months of our first scheduled lease expiry. We continue to look at every avenue to maximise returns to our shareholders.”

4. Sector data this week (AIC data, as at Thursday's close)



Equity Capital Markets

n/a

Ex Dividend

BBH 2.52p, CYN 1.26p, DIG 4.60p, EDIN 7.5p, EGL 2.125p, GOT 10p, HFEL 6.20p, HINT 3.9p, MMIT 1.70p, NCYF 1p, SEQI 1.71875p, SHIP $0.025, SIGC 0.10p, SOI 2p, SWEF 1.375p

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