RM Capital initiates offensive against Gore Street Energy Storage Fund, aiming to dismiss key directors
In a recent turn of events, London-listed investment trust, Gore Street Energy Storage Fund (GSF), is facing pressure from activist investor RM Funds, who is pushing for a board overhaul and strategic review. The multi-million-pound investment trust, listed on London's main stock market, has been under scrutiny due to a prolonged decline in its share price and a persistent discount to its net asset value.
RM Funds, the second-largest investor in GSF, has accused the company's board of presiding over a 'sustained underperformance' in the share price. The investor has requisitioned a general meeting to replace non-executive directors Patrick Cox and Caroline Janet Banszky with Brett Miller and Ian Dixon, citing the need for fresh perspectives unattached to past decisions.
Despite private engagements spanning over six months, GSF's board rejected RM Funds' proposal, leading to the requisition. GSF has announced it is verifying the validity of the requisition and advises shareholders to take no action currently. In response, GSF's CEO emphasized the company's focus on executing its mandate to scale intelligently and deliver long-term value for shareholders.
RM Funds' proposals for GSF also suggest selling some of its assets and appointing new directors to evaluate potential sale or merger options. The investor believes a new, unbiased board is necessary for a credible review of GSF's options. If successful, RM Funds has proposed replacing the removed directors with its own nominees.
The Gore Street Energy Storage Fund invests in massive battery projects in the UK, US, and Germany. Despite the failed assault by Boaz Weinstein's Saba Capital, activist investors continue to push for changes in the boards of London-listed investment trusts. Shareholders voted against Weinstein's campaign at all seven trusts he targeted last year, resulting in his defeat. However, the ongoing tension between RM Funds and GSF over strategic direction and governance underscores the growing influence of activist investors in the industry.
As the situation unfolds, both parties are expected to engage in further discussions, with the ultimate goal of ensuring the long-term success of the Gore Street Energy Storage Fund. The outcome of these negotiations could set a precedent for future interactions between activist investors and London-listed investment trusts.
Investor RM Funds, in its push for a strategic review and board overhaul of the Gore Street Energy Storage Fund (GSF), has suggested that selling some assets and appointing new directors may be necessary to evaluate potential sale or merger options, highlighting the need for fresh perspectives in finance and business. This push by RM Funds, who has accused GSF's board of presiding over a 'sustained underperformance' in the share price, follows a prolonged decline in the investment trust's share price and a persistent discount to its net asset value.
