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In March 2024, Scottish Mortgage, the largest listed closed-end investment trust in the UK, announced the largest-ever share buyback of £1 billion by such closed-end funds. That is probably the result of an activism campaign by Elliot Management.

Scottish Mortgage, with net asset value of £13 billion, has little to do with mortgages. Its largest holdings are tech companies like Nvidia and ASML. A quarter of its portfolio are private companies like SpaceX.

According to an analysis by Fidelity, before the buyback announcement, Scottish Mortgage was trading at 15% discount to NAV .

Thanks to the buyback program, the discount has narrowed to 6.5% (as at 8 May 2024).

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2024年3月，英国最大的上市封闭式投资信托Scottish Mortgage宣布价值10亿英镑的股票回购计划，此次计划是封闭式基金行业迄今为止最大的回购计划。本次股票回购是受Elliot Management的积极行动推动所致。

Scottish Mortgage的净资产价值为130亿英镑，但其业务与抵押贷款几乎没有关系。其最大持股为英伟达（Nvidia）和ASML等科技公司。SpaceX等非上市公司佔投资组合四分之一。

根据富达（Fidelity）的分析，在回购公告之前，Scottish Mortgage的交易价格较净资产价值折价15%。

由于此次回购计划，其目前的折价率为6.5%（截至2024年5月8日）。

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Source 来源: Financial Times

Published on 22 March 2024

Activist investor Elliott has built a 5 per cent position in Scottish Mortgage Investment Trust, whose early bets on tech groups such as Amazon turned it into one of the UK’s most popular investment vehicles before falling out of favour over the past two years.

The US investment group owns 0.5 per cent of the shares in Scottish Mortgage and amassed the rest of the position via equity derivatives, taking it over the 5 per cent disclosure threshold, according to a stock exchange filing from the trust.

The emergence of Elliott as an investor comes a week after Scottish Mortgage announced a £1bn share buyback in a bid to support its own stock, which peaked in late 2021 before higher interest rates chilled investors’ appetite for the high-growth companies the trust made its name backing.

Elliott, which is headquartered in Florida and manages around $65bn in assets, has over the past two decades built a reputation as a fearsome activist prepared to pursue boardroom battles to force change at the companies it targets.

According to a person familiar with the matter, Elliott started building its position in Scottish Mortgage last year and supports the trust’s share buyback plan. While the tech sector has staged a rebound on Wall Street over the past year, Scottish Mortgage’s own share price has failed to keep pace, opening a discount with the underlying value of its holdings that include Nvidia.

Scottish Mortgage is trading at a roughly 8 per cent discount to its net asset value, according to the Association of Investment Companies.

Justin Dowley, chair of Scottish Mortgage Investment Trust, said of Elliott’s investment: “We have been in contact, as we often are with shareholders,” without giving any details.

Elliott declined to comment.

The disclosure of Elliott’s interest late on Thursday after the stock market closed comes as investment trusts face pressure to consolidate as higher interest rates and complex regulations have cut their appeal and widened the discounts at which they trade.

The average discount between an investment trust’s share price and its net asset value hit 16.9 per cent last October, just below the 17.7 per cent recorded at the end of 2008, according to the Association of Investment Companies.

Scottish Mortgage became an unlikely star of global tech investing this century when its former manager, James Anderson, made a series of early and highly successful bets on Facebook, Amazon and Tesla. Its bet on Scottish Mortgage is not Elliott’s only recent interest in London-listed companies.