LONDON - The board of CQS Natural Resources Growth and Income PLC is urging shareholders to vote against resolutions proposed by Saba Capital Management L.P. at a forthcoming general meeting. The investment trust’s directors are advising rejection of the plan, which they label as self-interested and misleading, warning it could introduce significant risks to shareholder investments.
The dispute stems from a requisition notice received on December 18, 2024, from Barclays (LON:BARC) Capital Securities Client Nominee Limited, acting for Saba, demanding a general meeting to consider the removal of the current board and the appointment of new directors aligned with Saba.
Chairman Christopher Casey emphasized the board’s stance, stating, "Saba’s proposals are without merit, introduce new and significant risk to your investment and are not in the best interests of ALL Shareholders."
The board highlights the trust’s strong performance under its current management, citing a 167.0% total return in net asset value (NAV) and a 220.0% total return in share price since the appointment of the current joint fund managers in October 2015. They also note the annual continuation vote, which allows shareholders to opt for a 100% cash return if desired.
Saba’s counter-arguments include the potential removal of the manager, appointing themselves in that role, and changing the investment policy. The board expresses concerns that these changes could lead to shareholders being trapped in a long-term discount and questions the independence and natural resources experience of the directors Saba proposes.
The board is currently considering several options to maintain value for shareholders, including maintaining the current investment policy, increasing dividends, further discount management mechanisms, providing a full cash exit at NAV, or potentially combining with another investment trust or open-ended investment company.
The outcome of the board’s review is expected to be announced by June 30, 2025. In the meantime, the board is strongly recommending shareholders vote against Saba’s resolutions at the general meeting scheduled for February 4, 2025.
This article is based on a press release statement from CQS Natural Resources Growth and Income PLC.
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