Activist investor Saba claims first victory in UK investment trust takeover attempts

Activist investor hedge fund Saba Capital Management has landed its first victory in its ongoing attempts to displace the boards of several investment trusts.

Saba secured control of Edinburgh Worldwide (LON:EWI) (EWIT) during a shareholder vote today.

It comes as Saba has been building a sizeable stake in numerous UK investment trusts since late 2024 in an attempt to restore closed-ended funds with large discounts to net asset value that it believes are underperforming.

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The investment trust industry had until now largely batted off the challenges from Saba, amid concerns about its investment strategy.

But after a couple of failed attempts by Saba since last year to displace the EWIT board, it managed to build up enough influence to call and win a vote at the annual general meeting today (30 April).

EWIT said in a stock market update that there were “insufficient votes” in favour of re-electing five independent directors – blamed on fewer private wealth and retail shareholders – while three Saba nominees were approved.

Richard Stone, chief executive of the Association of Investment Companies (AIC), said: “Thousands of shareholders will be disappointed by this announcement, having twice rejected directors nominated by Saba only to see them appointed to the board at the third attempt.”

What the Saba vote means for investors

This is not Saba’s first attempt to take control of a UK investment trust, after losing votes with funds such as the Baillie Gifford US Growth Trust and the Herald Investment Trust.

But its persistence has paid off with EWIT after a couple of failed takeover attempts. Saba will now have control of its first UK investment trust in what Jonathan Simpson-Dent, chair of Edinburgh Worldwide, described as a "disappointing day".

He warned that long-standing shareholders are set to lose exposure to “this exciting mandate focused on next-generation technology, seemingly in favour of Saba's plan to invest in other UK investment trusts.”

Simpson-Dent added: “Retail and private wealth shareholders have been ground down by Saba's repeated attacks. A significant number have already chosen to exit the company, replaced by institutions seeking to capture the upside potential in EWIT's substantial SpaceX exposure.

"I expect many more retail and private wealth shareholders to follow. This should represent a wake-up call for the investment trust sector and its regulators.”

Danni Hewson, AJ Bell head of financial analysis, said Saba has been “like a dog with a bone” on EWIT.

She said: “While it may have successfully fought off Saba’s previous efforts – both last year and at the beginning of this year – the trust has suffered an ebbing away of long-term shareholders over time and this has made the activist’s task of assuming control somewhat easier.

“The timing of Saba’s victory is lent extra sensitivity by the looming market lift-off for Edinburgh Worldwide’s biggest holding – Elon Musk rocket and satellite firm SpaceX. Saba’s plan, once the blockbuster IPO happens, seems to be to liquidate this stake and turn the trust into a vehicle for investing in other undervalued UK investment trusts.”

Hewson suggests that Saba’s win will create consternation in the boardrooms of other investment trusts. AJ Bell research published in January 2026 showed Saba has holdings in more than 40 UK-listed trusts.

She added: “The trust universe has been vulnerable thanks to persistent discounts to the value of underlying assets, uneven performance and a growing preference for passive over active funds.”

With this in mind, investors may welcome Saba taking control and trying to turn things around.

However, hedge funds often approach investments with shorter time horizons in mind and it may be focused more on making money quickly.

This may not be a bad strategy if it works but it might not align with your own investment plan, risk tolerance, or your reasons for buying the trust in the first place.

Hewson added: “Saba’s efforts, which largely began in 2025, were effective as a wake-up call for the industry.

“However, now it has won control of a trust, warnings about its short-termist and self-serving approach and the impact on the interests of individual investors will be put to the test.”