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

The market tone was largely risk-off this week set by the news over last weekend that Moody's has reduced the US's credit rating from AAA to Aa1. Moody's had warned in 2023 that the US triple-A rating was at risk, following on from Fitch Ratings which downgraded in 2023 and S&P Global Ratings which did so as far back as 2011. Moody's has held a perfect credit rating for the US since 1917, but no longer. The US bond yield curve has been showing signs of steepening since then with 30-year bonds pushing well through a 5% yield now (peaked at 5.15%, but back at 5.04% currently). That has impacted equities with bonds definitely in the driving seat for the majority of the week with the S&P 500 Index down 2.7% at the time of writing. In the last few hours Trump has done his usual and dropped a 50% tariff threat on the European Union on goods imported to the US which is unlikely to improve sentiment into the close.

The UK signed another deal in the week to make it a hat-trick – this time with the EU to help with defence and trade likely worth around £9bn over the next decade. We also saw UK inflation move higher to 3.5% in April, the highest level since February 2024, up from 2.6% in April. This was largely expected given the rise in bills seen in April, albeit perhaps not to that extent. The Bank of England has previously said it expects inflation to peak at 3.7% between July and September 2025 before dropping back to its 2% target. Additionally, UK borrowing in April was £20.2bn, up £1bn from the same month last year. That has meant that rhetoric has started to build for higher taxes in the UK despite Chancellor Rachel Reeves saying at the Budget last year that there would be no additional tax rises beyond those already announced. For the nay sayers, the FTSE 100 Index has closed the week up 0.4%.

In the investment trust sector, it is great to see leading institutional shareholders Schroders, Aberdeen and TR Property pushing hard to keep high quality London-listed product in the shape of Assura on the London Stock market by pursuing a merger with Primary Health Properties, rather than a KKR / Stonepeak take private. Even more important when we have other high-quality product like BBGI leaving the market in the coming weeks. It just makes it even more disappointing then to see the news from Third Point Investors Limited this week. They have decided in their wisdom to merge their UK listed closed ended hedge fund with an “established reinsurance platform” and will likely offer a tender of at least US$75m at a 12.5% discount to NAV. AVI have come out quickly and publicly and savaged this, quite rightly. "Third Point Investors (TPOU) has for some time been the poster child for appalling corporate governance and today's announcement of an egregious related-party deal thoroughly cements that well-deserved reputation. Long suffering shareholders who've endured the Manager's persistent record of underperformance now face being dragged into Third Point's latest costly misadventure into insurance, noting that Third Point Reinsurance (now rebranded as SiriusPoint) has delivered a shareholder total return of less than 4% annualised since its creation in 2013, woefully underperforming peers and market indices..."

TPOU is a vehicle that has managed an 8.4% annualized NAV TR over the last 10 years. So in effect the Company is taking back circa 1.5 years of typical return to exit in the tender (and for less than 20% of issued share capital). Looked at another way, with an ongoing charge ratio of 2.33% (AIC / Morningstar data used as source), they are taking an exit fee of just over 5.25 years to participate in any such tender. Even more remarkably than that, albeit hidden in very legalistic language, Saba Capital, seems to be in favour of this scheme. So there are certain points that come out of this:

• The investment trust sector will survive this extremely rare corporate governance oversight but caveat emptor remains the key for those buying any investment product;
• Third Point, having treated UK investors thus, will never raise equity capital again in this market. The share price reaction tells you all you need to know;
• Investment trust board recruitment companies, take note of this story. A total failure of the Board to execute on corporate governance is not a story we want repeated in this sector;
• This is a more institutional product than others but as a London-listed fund, retail investors will be in here also sadly. Saba, with admittedly a modest holding of 1.2%, having seemingly agreed to this deal (albeit muddied by highly legalistic language) have failed to help UK retail one iota, so any argument from them in the future painting themselves as the saviour of UK retail is even more ridiculous than before.

If you want to see managers using the investment trust structure to great effect for the benefit of their long-term shareholders, following on from Frostrow’s London investor event last week, a Citywire article and video highlighting the attractions of the investment trust structure are available to watch here:

https://citywire.com/investment-trust-insider/news/what-s-the-future-of-investment-trusts-we-asked-nick-train-and-six-other-managers/a2466102

2. Frostrow Retail Investors Events

Augmentum Fintech (AUGM LN, Financials & Financial Innovation, £163.6m mkt capn, 40.5% discount to NAV): Please contact Frostrow for interest in seeing Tim Levene in London and the regions in 2025. The AUGM Capital Markets Day will take place on Wednesday 2 July 2025 at Searcy’s at The Gherkin, between approx. 8:30am and 1:30pm (timings and line up still to be finalised). The latest Frostrow webinar from our London seminar in May 2025 is available to see on You Tube here.

https://www.youtube.com/watch?v=HsulTfN_o1A

Aurora UK Alpha (ARR LN, UK All Companies, £287.6m mkt capn, 10.7% discount to NAV): the Phoenix investment team are available for meetings with investors in 2025. The last webinar was recorded on 20 January 2025 and is available on the following link:

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

Kartik Kumar gives his updated thoughts at the time of our London investor seminar in May 2025 here:

https://www.youtube.com/watch?v=ZZGGM5Aw5sw

Biotech Growth Trust (BIOG LN, Biotechnology & Healthcare, £189.9m mkt cap, 7.4% 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

Geoff Hsu gives further thoughts at the time of the Frostrow London investor event here:

https://www.youtube.com/watch?v=VjloEBj9O1I

CC Japan Income & Growth Trust (CCJI LN, Japan, £251.9m mkt capn, 8.2% discount to NAV): please contact Frostrow Capital in order to arrange a meeting with management in 2025. In addition, the last webinar was recorded on 22 January 2025 and is available on the following link:

https://www.youtube.com/watch?v=VcVErs9OUN8

In addition, we highlight the most up-to-date thoughts from management at the time of our London investor seminar in May 2025 here:

https://www.youtube.com/watch?v=VcVErs9OUN8

To sign up to view the next CCJI webinar via Frostrow and Investor Meet Company, please click the link (2pm, 17 June 2025):

https://www.investormeetcompany.com/cc-japan-income-growth-trust-plc/register-investor

CQS Natural Resources Growth & Income (CYN LN(CYN LN, Commodities & Natural Resources, £123.5m mkt capn, 6.4% discount to NAV): please contact Frostrow to arrange a one-on-one meeting with management in 2025. 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, £345.6m mkt capn, 19.7% discount to NAV): Richard Shepherd-Cross, lead manager, available for meetings in 2025 (physical throughout UK, or zoom, as per preference). 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

Richard also gives his most updated thoughts at the time of the Frostrow London investor event in May 2025 here:

https://www.youtube.com/watch?v=XOQA7R2yBKk

Ecofin Global Utilities (EGL LN, Infrastructure Securities, £2223.9m mkt capn, 9.3% 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 is available on the link below:

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

Finsbury Growth & Income Trust (FGT LN, UK Equity Income, £1,324.3m mkt capn, 7.5% discount to NAV): Nick Train’s AGM presentation (January 2025) 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

We also highlight our most recent recording of Nick’s presentation following our London investor event:

https://www.youtube.com/watch?v=HeiFCPd5zS8

MIGO Opportunities Trust (MIGO LN, Flexible Investment, £64.8m mkt capn, 6.1% 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, £150.6m mkt capn, 4.9% discount to NAV): Carlos Hardenberg, lead manager, presented at a webinar this week from his trip to Taiwan in April 2025. Please see below the link to the recording:

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

In addition, Carlos gives his thoughts at the time of the Frostrow London investor event in May 2025 here:

https://www.youtube.com/watch?v=E4GIjtAelhc

Temple Bar Investment Trust (TMPL LN, UK Equity Income, £890.8m mkt capn, 3.3% 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, or to see the recent AGM update

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

https://www.youtube.com/watch?v=AcVspDPT3-c

To sign up to view the next TMPL webinar via Frostrow and Investor Meet Company, please click the link (11am, 12 June 2025):

https://www.investormeetcompany.com/temple-bar-investment-trust-plc/register-investor

Worldwide Healthcare Trust (WWH LN, Biotechnology & Healthcare, £1,386.0m mkt capn, 11.1% 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. Further updates available on request.

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

Geoff Hsu gives updated thoughts at the time of the Frostrow London investor event in May 2025 here:

https://www.youtube.com/watch?v=VjloEBj9O1I

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. Trade deals are happening now. There will be others clearly. 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. Do not be short of investment trusts.

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: 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

Picton Property Income (PCTN LN, £388.4m mkt capn) FY results to 31 March 2025: EPRA NTA +4% to 100pps; EPRA EPS +5% to 4.2p vs DPS 3.7p. "Our net asset value is £533 million and although our portfolio valuation reduced, this was because we have made asset disposals. This has allowed us to repay our floating rate debt and reduce our financing costs." Occupancy at 94% (up from 91%). "The Board is well aware of the disconnect in the listed real estate sector between share prices and reported net asset values. This has led to considerable corporate M&A activity this year, with purchasers taking advantage of this arbitrage, as companies have been either taken over or taken private at levels more reflective of book value." Separately, PCTN has announced a 40% increase in the maximum aggregate consideration of the buyback programme to £17.5m.

STS Global Income & Growth FY results to 31 March 2025 (STS LN, Global Equity Income, £291.9m mkt capn, 1.0% discount to NAV): NAV TR +10.9% vs Lipper Global - Equity Global Income Index +4.5%; share price TR 10.9%; 8.37pps dividend for the year is a 3.5% dividend yield; "The Company bought back 19.4 million shares during the year at a total cost of £43.9 million and at an average discount of 1.4%, with a net benefit of £564,000 to shareholders after costs. The buyback amounts to 13.8% of the shares in issue on 31 March 2024. By any standards this is a significant purchase and the share price discount to NAV was 1.7% at the start and end of the year. This purchase represented a significant use of shareholders' capital and provided liquidity and value to the minority of shareholders who chose to sell shares. The Board is minded to enhance the benefits for the majority of shareholders who choose to remain invested."

Polar Capital Global Healthcare HY results to 31 March 2025 (PCGH LN, Biotechnology & Healthcare, £386.8m mkt capn, 5.7% discount to NAV): NAV TR -10.3% vs MSCI ACWI Healthcare Index TR, £ -3.3%; share price TR -11.7%; "While we await the longer-term impact of Trump's administration, the Board remains optimistic about the outlook for the healthcare sector." "...the Board has started considering the future of the Company in light of its fixed-life and has commenced work with its advisors to potentially bring forward proposals for a corporate reorganisation in the second half of 2025. This would be ahead of the requirement to propose liquidation at the first AGM to be held after 1 March 2025 which would ordinarily take place in early 2026. The Board will consider all options and following the conclusion of this review and should feedback indicate positive appetite and support for the continuance of the Company, alternative resolutions may be put to shareholders ahead of the 2026 AGM, removing the requirement to put forward a liquidation resolution. Further details on any alternative proposals will be communicated to shareholders once available."

Phoenix Spree Deutschland (PSDL LN, Property – Europe, £153.4m mkt capn, 33.1% discount to NAV) The Board is convening an EGM to seek the approval of Shareholders to implement a compulsory redemption facility, to give the Company flexibility to return cash to Shareholders on a pro rata basis, in a cost-effective and timely manner, through compulsory redemptions of its ordinary shares.

M&A news

Harmony Energy Income Trust (HEIT LN, Renewable Energy Infrastructure, £208.5m mkt capn, 0.6% discount to NAV) On the basis that neither Drax Bidco nor Foresight Bidco have declared their offers final, such that either offer may be further increased or otherwise revised, a competitive situation continues to exist. HEIT has agreed with the Panel, Drax Bidco and Foresight Bidco to an Auction Procedure on the evening of Wednesday 21 May 2025 to resolve the competitive situation. The Board recommend shareholders take no action until then. Further to that announcement and further to the announcement made by Drax confirming that it will not be increasing the financial terms of its offer for HEIT at a price of 88p per HEIT ordinary share and the announcement by the Panel Executive that the Auction Procedure outlined in Panel Statement 2025/3 will not take place, the HEIT Board reaffirms its unanimous recommendation of the cash acquisition of HEIT by PP Bidco Limited (ie Foresight) at a price of 92.4p per HEIT ordinary share. Accordingly, the HEIT Board recommends that HEIT Shareholders vote in favour of the Foresight Acquisition at the shareholder meetings convened for 30 May 2025, as set out in the scheme document published on 6 May 2025.

Assura (AGR LN, £1,600m mkt capn): KKR and Stonepeak Partners (Sana Bidco) have noted the announcement regarding a potential offer from Primary Health Properties for Assura plc and continues to believe “that its recommended cash offer… represents a superior proposal for Assura shareholders.” “Bidco will continue its engagement with the Assura Board to deliver the terms of the transaction that has been recommended by Assura to shareholders… [and] in relation to the PHP Offer, Bidco notes numerous critical issues which it believes significantly increase the financial risk profile of the combined entity, potentially harm the future returns and growth prospects for both Assura and PHP shareholders and lead to the combined business being highly capital constrained.” [The Sunday Times reported that Schroders, Aberdeen and TR Property Trust "preferred a merger...so the combined group could remain on the London Stock Exchange."] Subsequently, Assura announced that "Having carefully considered the PHP Offer with its advisers and consulted with Assura's major shareholders, Assura has engaged in further discussions with PHP and commenced due diligence in relation to PHP to determine whether to recommend the PHP Offer to Assura Shareholders...It is therefore recommended that Assura Shareholders do not attend the Meetings scheduled for 5 June 2025 and take no further action at this stage in relation to the Cash Offer and the PHP Offer."

BBGI Global Infrastructure (BBGI LN, Infrastructure, £1,022.3m mkt capn, 0.8% premium to NAV) BCI Bidco has “received valid acceptances in respect of 48.70% of BBGI Shares as at 19 May 2025. BBGI shareholders are urged to accept the offer as soon as possible and, in any event, before 13:00 (London Time) on 20 May 2025.”

LondonMetric Property (LMP LN, £4,030m mkt capn): LMP announces the terms of a recommended all-share offer for Highcroft Investments. As such LMP announce the admission of 24,210,964 New LMP Shares. LMP subsequently announced FY results to 31 March 2025: EPRA NTA +3.9% to 199.2pps; EPRA EPS +20.7% to 13.1p vs DPS +17.6% to 12p; EPRA cost ratio of 7.8%. LFL income growth +4.2% drove valuation uplift; WAULT 18.5 years; occupancy 98%; LTV 32.7%. Q1 2026 dividend guidance of +5.3% to 3pps.""We have every reason to be optimistic about our relentless expansion and the opportunities available from our highly scalable platform. In an environment where scale is essential, our £6 billion portfolio is set to grow by a further £1 billion through M&A activity which will add to our urban logistics exposure, our strongest conviction call sector for rental growth."

Continuation vote

Fidelity Japan Trust (FJV LN, Japan, £202.3m mkt capn, 7.5% discount to NAV) failed to pass its continuation vote at the AGM and the Board is currently reviewing “formal written non-binding proposals from a small number of London listed investment companies focused on investing in Japan” which would require a scheme of reconstruction and the Board “will update the market on the progress of the review in due course.”

Saba Capital update

The European Smaller Companies (ESCT LN, European Smaller Companies, £774.2m mkt capn, 5.4% discount to NAV) received valid tenders in respect of 166m shares (42.2% of ISC), with 115m electing for the In Specie option and reminder electing for cash. "As a result, the Tender Offer was undersubscribed." The Company subsequently announced the allocations of those tendering: Cash Exit Tender Offer FAV: £107,684,316 in respect of the 50,726,953 Ordinary Shares that have been successfully tendered pursuant to the Cash Exit Option; In Specie Tender Offer FAV: £244,944,253 in respect of the 115,386,122 Ordinary Shares that have been successfully tendered pursuant to the In Specie Consideration Option.

Gearing news

Majedie Investments HY results to 31 March 2025 (MAJE LN, Flexible Investment, £142.0m mkt capn, 1.2% premium to NAV): NAV TR -4.1%; share price TR +7.4%; quarterly dividend 4.1pps (+5.1%); Company now has no structural gearing; "The Board concurs with Marylebone Partners that the best way to capitalise on the opportunities that will be created during this period of change is to invest with discipline and require a margin of safety and that structural leverage is not required in pursuit of inflation beating total return"

Board review update

JPMorgan Indian IT (JII LN, India / Indian Subcontinent, £694.0m mkt capn, 8.3% discount to NAV): has announced that it "has undertaken a detailed review of options for the future of the Company, exploring a number of initiatives to help to identify and address the drivers of underperformance and the persistent discount at which the Company's share price trades. The Board has concluded that, in the current environment, shareholders will be best served by the Manager's existing investment strategy and, following consultation with major shareholders, the introduction of a package of robust discount control mechanisms, the adoption of an enhanced dividend distribution policy and a reduction in the investment management fee." The discount control mechanism to include a 30% tender in Q3 2025, buybacks to target a discount in single figures and a triennial tender of 100% of shares capital at NAV less 3% starting in Q2 2028. "The Board proposes to pay dividends each financial year totalling at least 4% of the net asset value of the Company at the end of the preceding financial year. " "With effect from 1 October 2025 the annual investment fee will be calculated as 0.65% on the first £300 million of the lower of the Company's market capitalisation or net assets and 0.55% in excess of £300 million, instead of 0.75% on the first £300 million and 0.60% in excess of £300 million."

Third Point Investors (TPOU/S LN, Hedge Funds, £424.4m mkt capn, 23.2% discount to NAV) following on from its review has “entered into a sale and purchase agreement to acquire Malibu Life Reinsurance SPC, an established reinsurance platform focused on the US fixed annuity market… to create a fast-growing, fully capitalised, London-listed, reinsurance operating company.” TPOU is acquiring Malibu from Third Point Opportunities Master Fund LP in exchange for new TPOU shares on a NAV-for-NAV basis. The company is “considering a potential tender offer of at least $75m” for shareholders who are seeking to realise part of all of their TPOU investment and the company “has received conditional commitments from new and existing investors, including Third Point, for $55m in aggregate to purchase a proportion of shares that may be tendered at a price that represents a discount to NAV of 12.5%.”

Foresight Solar Fund (FSFL LN, Renewable Energy Infrastructure, £426.7m mkt capn, 30.4% discount to NAV) trading and strategic option considerations update: “electricity production in the UK was 9.4% above budget, reflecting strong irradiation in March and April… In Spain, grid outages added to poor weather conditions, resulting in production 11.7% below forecasts. Lower irradiation also proved an issue in Australia, where higher-than-expected curtailment combined to stifle production, which was 11.1% below expectations.” Australian asset sale continues but FSFL now “believes targeting a deal before the end of the year is more realistic.” "...as the £50 million buyback programme nears completion, the directors will continue to review the total allocation." "The board further cited its view that consolidation is likely to be a major feature in the sector in the year ahead and that the directors are fully aware of the benefits that successful consolidation can deliver to shareholders, and this forms a critical part of the ongoing strategic considerations. It is against this backdrop that the board evaluated various opportunities which culminated in a formal proposal which the FSFL board was unable to ultimately advance, and those discussions were terminated. The board will continue to evaluate all potential options that it believes will maximise value for shareholders."

HarbourVest Global Private Equity (HVPE LN, Private Equity, £1,780.2m mkt capn, 42.5% discount to NAV) announces that it has agreed the final heads of terms of its strategic transition to a new, simplified investment model with HarbourVest Partners which was originally announced on 30 January 2025 as part of the Board's three initiatives aiming to maximise returns for shareholders and narrow the discount to Net Asset Value. Under the new investment model HVPE will adopt a Separately Managed Account structure and will move away from investing through HarbourVest Partners' co-mingled funds. Going forward, capital will be deployed by the Manager via a dedicated HVPE vehicle directly into third party General Partner funds, secondary opportunities and co-investments. The transition to the new structure will, by necessity, be gradual. New commitments will be directed to the SMA, while the existing portfolio of HarbourVest funds will continue to operate as before. Should lead to lower debt, marginally lower fees and the same access to deals. It also subsequently announced a NAV at 30 April 2025 +1.7%

Capital allocation update

GCP Infrastructure quarterly update to 31 March 2025 (GCP LN, Infrastructure, £589.8m mkt capn, 31.6% discount to NAV): The Board reconfirms its 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 £50.0 million of capital to shareholders. At 31 March 2025, the Company had £41.0 million (31 December 2024: £61.0 million) outstanding under its revolving credit arrangements, representing a net debt position of £29.2 million (31 December 2024: £42.5 million) which compares to the Company's unaudited NAV of £871.7 million (31 December 2024: £910.7 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. 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. The Board and the Investment Adviser continue to focus on additional opportunities for refinancings or disposals within the portfolio, in order to achieve the targets set out in the capital allocation policy, with a number of active processes.

Results / updates

HICL Infrastructure (HICL LN, Infrastructure, £2,201.6m mkt capn, 26.4% discount to NAV) FY results to 31 March 2025: NAV -3.2% to 153.1pps, as discount rate increased to 8.4%; operational performance was “solid”. New dividend guidance of 8.5pps for FY2027 and reaffirmed guidance for FY206 of 8.35pps. “Continued focus on effective capital allocation in the year, with the initial £50m buyback completed and expanded by a further £100m. In excess of £200m of targeted divestments in the coming year.” Fee basis to change from GAV to 50% of NAV and 50% of market cap, effective 1 July 2025. (Management fee estimated to fall by 17% and ongoing charge ratio to fall from 1.1% to 0.95%). £441.8m of liquidity available via the RCF.

The Edinburgh Investment Trust FY results to 31 March 2025 (EDIN LN, UK Equity Income, £1,152.5m mkt capn, 7.5% discount to NAV): NAV TR +8.3% vs FTSE All Share Index +10.5%; share price TR +11.3%; net gearing 5.0% (31 March 2024: 3.1%); dividend yield 3.9%; ongoing charge ratio 0.51%; marks the fifth anniversary since the appointment of the management team, Liontrust. Bought back 4.7% of issued share capital to help address the discount to NAV. "As a Board we have considered the scale of the buyback and whether we should go further with a view to achieving a tighter discount. We have also considered other measures that might help narrow the discount, such as continuation votes and tenders. For now, with strong long-term NAV total returns, including the dividend growth described above, as well as the marketing of the Company described below, we are confident that our approach will move market perceptions in Edinburgh's favour and allow the discount to tighten further. The Board will continue its strong focus on this and will keep all options under close consideration." Company is tidying up the investment objective and policy to 'The Company aims to exceed the total return on the FTSE All-Share Index and grow its dividend faster than UK inflation. This objective will be assessed over the long term and performance against the FTSE All-Share Index will be measured on a NAV total return basis.'

Scottish Mortgage (SMT LN, Global, £11,620.3m mkt capn, 11.4% discount to NAV) FY results to 31 March 2025: NAV TR +11.2% vs FTSE All-World +5.5%. Chair: “We take a pragmatic approach in making capital allocation calls between buying back shares and other uses of capital such as making new investments and reducing debt. The Board and the managers remain committed to the continuation of the buyback.”

Schroder Oriental Income HY results to 28 February 2025 (SOI LN, Asia Pacific Equity Income, £636.3m mkt capn, 4.8% discount to NAV): NAV TR +2.5% vs MSCI AC Pacific ex Japan (TR, £) +10.4%; share price TR +4.9%; "This performance gap was largely as a result of being underweight China, where we remain cautious due to the significant economic challenges facing the government, and where technology stocks were the main beneficiaries of the rally." During the six months up to 28 February 2025, the Company repurchased 9,632,000 ordinary shares. First and second interim dividends of 2pps paid; "The Company has revenue reserves of £23,657,000 (equivalent to 10.19 pence per share) after paying the first interim dividend. Such reserves are available to support the level of dividend you receive. This ability remains key advantage of investment trusts over other savings and investment vehicles." Average gearing 5.5%.

Patria Private Equity (PPET LN, Private Equity, £851.5m mkt capn, 28.2% discount to NAV) NAV as at 30 April 2025: -0.3% over the month to 784pps and received £8m of distributions vs £6.7m drawdowns. The Company had £735.1 million of outstanding commitments at 30 April 2025. The Company has a £400.0 million syndicated revolving credit facility provided by The Royal Bank of Scotland International Limited (£257.8 million was undrawn). "In addition, the Company had cash balances of £19.1 million at 30 April 2025. Furthermore, PPET is also due £95.7 million of deferred consideration in September 2025 from its secondary sale of a non-core portfolio of investments. Therefore, short term resources, calculated as the total of cash balances, deferred consideration and the undrawn balance of the credit facility, were £372.6 million as at 30 April 2025."

Wind up news

Riverstone Energy (RSE LN, Commodities & Natural Resources, £197.1m mkt capn, 29.6% discount to NAV) has announced a proposal of a managed wind-down has been agreed between the company’s Board and manager and proposals will be put forward to shareholders in a circular “as soon as practicable.” The management fee payable would reduce from 1.5% of NAV to 1%, subject to a minimum of $500k pa and the current performance allocation would cease to apply. Instead, the company would agree to pay an “adjustment payment” payable in two tranches – one shortly after approval of the managed wind-down, the other following completion of the sale of the final investment. "Full details of the proposals for Managed Wind-Down, including further information on the expected timeline for the sale of the Company's assets and full details of the Company's revised arrangements with the Investment Manager, will be published in a circular to Shareholders as soon as practicable."

VPC Specialty Lending Investments (VSL LN Debt – Direct Lending, £41.7m mkt capn, 72.3% discount to NAV) in regard to the second return of capital (of £43m), the Company has announced shareholders will receive 15.45 new B shares for each ordinary share held and the B shares will be redeemed at 1pps on 29 May 2025. Proceeds due around 12 June

Starwood European Real Estate Finance (SWEF LN, Property – Debt, £168.7m mkt capn, 13.6% discount to NAV) NAV as at 30 April 2025: 100.59pps; cash & equivalents £50m vs £19m of undrawn commitments.

VH Global Energy Infrastructure (ENRG LN, Renewable Energy Infrastructure, £229.6m mkt capn, 44.2% discount to NAV) having consulted shareholders over the last 6 months, ENRG has announced that it will "commence an asset realisation strategy which will require a change to the Company's investment policy". The Board is firmly of the opinion that it is in Shareholders' best interests to retain Victory Hill to deliver the Proposed Asset Realisation Strategy. Likely to take no longer than 3 years. Separately, ENRG has announced “its 10MW UK flexible power generation and carbon capture and reuse asset has achieved the first delivery of liquefied food-grade CO2 to Buse Gases Ltd.”

Riverstone Credit Opportunities (RCOI LN, Debt – Direct Lending, £50.4m mkt capn, 16.5% discount to NAV) will return a further $16.8m via a secondary compulsory redemption of 19m shares at $0.88 per share as part of its managed wind down. The redemption date is 27 June 2025. The company has also declared a dividend of $0.0008 in relation to calendar Q1 2025.

Share split

Caledonia Investments (CLDN LN, Flexible Investment, £1,926.5m mkt capn, 33.1% discount to NAV) FY results to 31 March 2025: NAV TR +3.3% to 5475pps, with all three investment pools contributing. “Proposed final dividend of 53.91pps, taking total dividend for the year to 73.6pps, a 4.5% increase compared to 2024.” “Change in the dividend payment profile from 2025/2026 to increase the interim dividend to 50% of the prior year's total annual dividend.” Total liquidity of £476m. CLDN will seek approval for a 10:1 share split. This "is expected to improve accessibility for a wider range of shareholders." The cap from the Cayzer family Concert Party's holding was constraining the company's ability to buy back any further shares.

Management arrangements

Franklin Global Trust (FRGT LN, Global, £197.5m mkt capn, 5.1% discount to NAV): following the retirement of the Martin Currie brand, from 12 July 2025, Zehrid Osmani and the Global Long-Term Unconstrained team will move from Martin Currie Investment Management Limited to Franklin Templeton Investment Management Limited, and investment management will be delegated to the Company.

Cordiant Digital Infrastructure (CORD LN, Infrastructure, £672.3m mkt capn, 29.8% discount to NAV) has announced Benn Mikula, co-managing partner of the company’s investment manager, “has stepped down in order to explore new opportunities.” "Steven Marshall, co-founder and executive chairman of the Investment Manager's digital infrastructure team, along with the other senior members of the team, including Jean-François Sauvé, co-managing partner and executive chairman of Cordiant Capital, continue to lead a strong sector specialist group that includes senior operational executives and private capital professionals with deep expertise in the sector."

UK Tax residency

Schiehallion Fund (MNTN LN, Growth Capital, £1,076.8m mkt capn, 22.7% discount to NAV) “has begun the process to enable MNTN to become UK tax resident and to be able to join the UK's investment trust regime. It is anticipated that this would take effect during Q1 2026.” The company will also consult shareholders on a potential transfer onto the Main Market of the LSE, from the Specialist Fund Segment. The Board expects to make further announcements of developments in due course.

Valuation news

Social Housing REIT (SOHO LN, Property – UK Residential, £272.8m mkt capn, 39.5% discount to NAV) has declared a 1.405pps dividend in respect of calendar Q1 2025 and announced a FY2025 target of 5.46pps. Change to valuation policy to move from quarterly to bi-annual frequency and to bring SOHO in-line with wider listed UK Real Estate sector: “Going forwards, SOHO’s properties will continue to be independently valued by Jones Lang LaSalle Limited on an individual asset basis (as required by IFRS) at the 30th June and 31st December in each year.”

Gresham House Energy Storage (GRID LN, Renewable Energy Infrastructure, £367.0m mkt capn, 41.5% discount to NAV) NAV as at 31 March 2025: NAV unchanged over calendar Q1 2025 to 109.35pps, as a reduction in revenue forecasts offset other developments. “Weighted average discount rate is 10.68% for the full portfolio including projects under construction and 10.54% for the operational portfolio.” “The underlying portfolio generated revenues of £15.9m and EBITDA of £11.2m in Q1 2025.” Total debt drawn of £160m; “The Manager therefore still expects to conclude the refinancing in Q2 2025, with new project financing to follow. Concluding the refinancing and securing additional project finance for new projects is expected to provide capital to fund additional new projects and augmentations, unlocking significant value for the fund. More information on the refinancing and pipeline plans will be announced in due course..” “A transaction to demonstrate valuations in the portfolio continues to progress well and is in final stages. An announcement on the transaction is expected to be made in the current quarter. The competitive process to acquire HEIT is also encouraging for the sector, demonstrating the widening interest in BESS assets and providing support for industry valuations."

Portfolio news

RTW Biotech Opportunities (RTW LN, Biotechnology & Healthcare, £398.7m mkt capn, 31.4% discount to NAV) has noted portfolio company Rocket Pharmaceuticals’ announcement re “preliminary data from its Phase 1 clinical trial of RP-A601 for PKP2 Arrhythmogenic Cardiomyopathy.” Rod Wong commented that “We are excited to see this encouraging preliminary data from Rocket's RP-A601's Phase 1 clinical trial, which we flagged as a key catalyst in the company's annual results on 31 March 2025, demonstrating clear progress on Rocket's aim to deliver potentially curative treatments to patients.”

Apax Global Alpha (APAX LN, Private Equity, £573.5m mkt capn, 39.6% discount to NAV) will invest €25m in the Treasury and Capital Markets (TCM) division of Finastra on a look-through basis.

BioPharma Credit (BPCR LN, Debt – Direct Lending, £993.8m mkt capn, 12.4% discount to NAV) has announced following the acquisition of OptiNose (OPTN US) by Paratek, the company has “received a payment of $82.8m, comprised of $71.5m in returned principal and $11.3m of make-whole and prepayment fees, and accrued interest. BPCR also expects proceeds of $1.6m in connection with the company's outstanding OPTN shares.” BPCR has invested $25m in a $275m new senior secured loan agreement with Paratek.

Secondary listing

Greencoat Renewables (GRP LN/ID, Renewable Energy Infrastructure, £800.5m mkt capn, 31.1% discount to NAV) has been granted approval for a secondary listing of its shares on the JSE, which will take effect from 9 June 2025.

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



Equity Capital Markets

EJF Investments (EJFI LN, Debt – Structured Finance, £70.0m mkt capn, 28.3% discount to NAV): "gross proceeds of approximately £584,040 in the RetailBook Offer"

Ex Dividend

AAS 1.60p, AERI/AERS €0.0079, BBOX 1.915p, BRGE 1.75p, BSIF 2.20p, GRI 2.85p, HICL 2.07p, JGGI 5.70p, JUGI 3.76p, NESF 2.11p, RGL 2.50p, SAIN 3.625p, SMIF 0.50p, WKOF 4.0788p