Tom Buidhe
28 Apr 2015
Re: Last-minute compromise [link] the video for Lex's view on 'Should Alliance Trust exist?'
trader jack
28 Apr 2015
Re: Last-minute compromise LKHTemerity doesn't equal authority though does it?...
LK Hyman
28 Apr 2015
Re: Last-minute compromise Jack,"does Alliance Trust have the authority to approve two and drop the third without first gaining shareholder approval?"They certainly have the temerity to do so.LKH on the flybridge the fragrant one is histor
trader jack
28 Apr 2015
Re: Last-minute compromise Report on Reuters:-LONDON, April 28 (Reuters) - Alliance Trust has agreed to revamp its embattled board by appointing two of the three directors pushed by Elliott Advisors, handing a partial win to the activist just hours before other investors were due to vote on the shake-up.The last-minute compromise marks the end of one of the highest-profile shareholder rebellions against a British company and sets the stage for further change at the 127-year old company led by Katherine Garrett-Cox.Elliott had called a vote to add Anthony Brooke, Rory Macnamara and Peter Chambers, the former CEO of Legal & General (LSE: LGEN.L - news) Investment Management, to refresh the seven-strong Alliance board on March 16, citing concerns that the trust's management had run out of ideas to boost shareholder returns."Having considered this feedback we have worked with Elliott to find a compromise which we believe is in the best interests of all our shareholders," Alliance Chairwoman Karin Forseke said in a statement that welcomed Brooke and Macnamara to her board.Forseke told Reuters last week that the board recognised its responsibility to "challenge all elements" of the company's business, and said it would reflect on feedback from shareholders.Elliott's campaign to overhaul the trust's board, which won wide support from shareholders and advisory firms, morphed into a debate around the company's governance, executive pay and the possible merits of outsourcing management of Alliance's diversified portfolio of assets.Alliance rejected Elliott's criticisms in a series of statements and video appeals that questioned the activist's long-term intentions and the independence of its nominees but moved to appease the investor in talks led by Forseke on Monday."This is a sure sign that having seen the scale of proxy votes from shareholders mounting up in favour of a shakeup, the Board has rightly determined compromise is better than a very public defeat," said Jason Hollands, managing director of Tilney Bestinvest, which planned to vote its clients' shares in favour of Elliott's proposals."The status quo is clearly no longer an option but the first vital step is for a de-escalation of tensions after the war of words of recent weeks," he added.PRESSUREInvestors and analysts said the compromise would increase pressure on Garrett-Cox to address the trust's underperformance and the gap between its share price and the value of the assets it holds, a long pending demand by investors that has led to three shareholder revolts since 2011.The trust's shares have lagged rivals such as Scottish Mortgage and F&C Investment Trust over both five and ten year periods and traded at 12.3 percent discount to their net asset value as at April 27, more than twice that of average peers, data from trade body AIC showed.Elliott has agreed to suspend any plans to agitate against the board or management of Alliance publicly until after the 2016 annual general meeting, giving a respite to the firm to improve performance."The key question now is whether the changes the trust has put in place will deliver outperformance for investors, and on that point we will have to wait and see," said Laith Khalaf, senior analyst at investment firm Hargreaves Lansdown (LSE: HL.L - news) .Shareholders had favoured the trust's management in two similar campaigns by hedge fund Laxey Partners in 2011 and 2012.Nearly 80 percent of the shareholders voted against Laxey's resolution to consider outsourcing the management of its assets in 2012. A year earlier, over 65 percent voted against Laxey's resolution to set up an automatic share buyback policy.Elliott is the largest individual shareholder of the trust with a 12 percent stake but 'mom and pop' investors, who hold 65 percent of its shares, have the greatest say in who they want to run the Dundee-based firm."I think Alliance might have scraped through, but the very fact that the res
trader jack
28 Apr 2015
Re: Last-minute compromise It is noticeable that this announcement has been made the day before the AGM and havng asked the shareholders to vote on the proposal to elect three new directors does Alliance Trust have the authority to approve two and drop the third without first gaining shareholder approval?Have Alliance announced the results of the ballot?Does this compromise mean that Elliott's have won the argument?Will the meeting vote against the ever fragrant KGC at the AGM?
Bally Hopefull
28 Apr 2015
Re: Last-minute compromise What a waste of money all round held for 40 years! what next.
LK Hyman
28 Apr 2015
Re: Last-minute compromise Ben,This is a shabby stitch-up compromise! Elliott get two of their boys on the board (I wonder why Peter Chambers got deepsixed!) without the vast bulk of the shareholders, who have been warmed up by all the argy bargy, having the opportunity to have their say. Disgraceful!No doubt KGC will get someone mesmerised by her as the third musketeer, and nothing much will happen.And what's all this "no disparagement" malarky? Although Elliott may feel that they have won a tactical victory, I think they have lost the moral high ground ... if it can ever be said that a bunch of Yankee sharks occupy moral high ground.LKH on the flybridge the fox has been shot two days earl
sansione
28 Apr 2015
Re: Have you voted? The only thing I would disagree with is your statement that it is not a very big one. It is actually very big in comparison to most ITs. This however makes it easier to run rather than more difficult .
Ben Alligin
28 Apr 2015
Last-minute compromise The Board of Alliance Trust plc announces that, following discussions, Elliott Advisors (UK) Ltd, its largest shareholder, has agreed to withdraw its three resolutions from the Alliance Trust Annual General Meeting on 29 April 2015 and has committed to support the Board and management on all other resolutions. The Board and Elliott have also agreed on certain mutual non-disparagement undertakings and that Elliott will not call a general meeting or seek to agitate against the Company, its Board or management publicly until after the Company's 2016 AGM at the earliest. The Board has agreed to appoint Anthony Brooke and Rory Macnamara to the Board of the Company once customary regulatory approvals have been obtained and that they will act as board observers in the interim period. In addition, as previously announced on 14 April 2015, the Board has accelerated the process to appoint an additional independent non-executive director, which will be done in consultation with the Company's major shareholders.[link]
Wynford2
28 Apr 2015
Re: Have you voted? “…while almost all of shareholders funds are in an investment trust, this is not the principal activity of the Company”Absolutely, there is not even a dedicated investment team on ATST any more; it is instead run as a sideshow by the ‘ethical’ ATI guys. The accompanying dramatic change to a ‘green’ investment policy last September would, in any other IT, be put to the shareholders for confirmation instead of being buried behind 'investing for generations' marketing gloss. No wonder that Elliot were pushed into action.The management know they can use the loyalty of the small ATST shareholders to further their ambitions of building a financial services company.But active USA funds are likely to be surprised by how passive most Brit investors are.
LK Hyman
28 Apr 2015
Re: Have you voted? New pilgrim,Although I am not a shareholder, and am interested in ATST only because my daughter is a shareholder, I find myself totally convinced of the reasonableness of the attempt by the Yankees to parachute three new NEDs onto the board, and would certainly vote in favour of it if my name were on the shareholder register [pause for spontaneous outburst of joyous clapping].It seems to me that the undoubtedly fragrant KGC has completely bewitched the existing board and senior management like a latter day Svengali. It'll be a shame in many ways to see the back of her, but go she must, in my humble. Well over a million spondoolies for runnin' an investment trust (and not even a very big one at that)? ... You're 'avin' a laff; she's 'avin' a laff!LKH on the flybridge
New pilgrim
27 Apr 2015
Re: Have you voted? Trader Jack,Ultimately its not just about the results, whether the Trust has performed quite as well as its peers or not, although a lot of fuss is made about this. What it is about is the next layer down. That is what the Company is actually doing.When one looks closely at what is happening there, it becomes apparent that not everything is as it should be, in fact it is very far from that. Precisely how well the fund does is largely a matter of stock picking and timing. There is a degree of random chance in this, and apart from obvious abuses,( e.g. excessive trading or churning as it is known, ) small variations in performance prove very little.The high level of the discount of the share price to the net asset value of the fund gives the markets view of the performance of the fund management. The market clearly take a poor view of Katherine CGs efforts. This poor view is founded on two key considerations. The first is the level of costs levied by the management, these are rather high, and there are grounds for saying that there are further costs as well that are masked from view. The other consideration is whether the Company is being managed as an investment trust, or whether it is doing other things as well from which the shareholders do not benefit.Alliance Trust has no trust deed and no trustees. The idea in such an investment trust is that the Board should consist the executive directors, and independent directors, the independent directors fulfilling the role of trustees for the shareholders. The principal of an investment trust is that shareholders monies should be invested in a diversified range of businesses and assets on behalf of the shareholders, and nothing else. In fact, examining the Company in a little more detail it becomes apparent that the major activity of the Company is no longer focussed on the shareholders interest. In Alliance Trust while almost all of shareholders funds are in an investment trust, this is not the principal activity of the Company. The principal activity is running financial service businesses in the subsidiary companies, Alliance Trust Savings and Alliance Trust Investments. These subsidiary Companies lose money. A situation which is not likely to change any time soon. Most of the 270 employees of Alliance Trust are employed by the subsidiaries. Apart from the reported losses, the subsidiaries do not carry all their own costs.The subsidiaries are very popular with their customers, on account of the low charges. Now there is obviously a lot of difference between managing an investment trust, where there is no product to sell (all the shares are already owned and traded in the market), and managing a customer facing retail service business. AT do not really seem to be very good at managing the subsidiaries. With approaching £9billion in customer funds, they are still losing money and being subsidised by us, the shareholders.This wouldn't matter so much if it wasn't for the risks it introduces to shareholder funds, shareholders will have to pay for claims in relation to the employees, their pensions, and likewise to compensate the customers of the financial service businesses. Further to that the conflicting interests of the new stakeholders in the subsidiaries compromise the trustee role of the board. The new stakeholders are the executive management, the large body of employees, and the customers for the £9 billion of funds.In short, KCG has been building her 'empire' with scant regard for the real interest of the shareholders. It is difficult to see how a Board could run further astray for the shareholders interest than this one has.Put simply, what the Board of Alliance Trust have done is completely indefensible in business terms, and amounts to a fraud on the shareholders. Now I doubt that they meant to come to this position, the nicest people in the world do stupid things at times. As a small shareholder, and pensioner, who
trader jack
27 Apr 2015
Have you voted? Even my grandchildren have exercised their votes...From today's Torygraph:-The fate of Alliance Trust hangs in the balance after two major institutional shareholders threw their weight behind the bid by Elliott Advisors to parachute in three new directors to shake up the venerable company.Aberdeen Asset Management and Legal & General Investment Management, who between them own 4pc of Alliance, were said to support the American hedge fund’s attempted coup against the current board and chief executive Katherine Garrett-Cox.However, hopes on the Elliott side that the increased pressure from major shareholders might force a capitulation appeared potentially forlorn. A source close to Alliance said the investment trust had no plans to hold talks with Elliott before its crunch shareholder vote on Wednesday, yet added “that could still change”.An Elliott source claimed it was still in the interests of Alliance management to come to an agreement in private rather than face potential public defeat.Neither side was willing to predict a victory when their war of words in recent weeks culminates in a series of shareholder votes at Alliance’s AGM, at the Gardyne Theatre in Dundee.Elliott, which owns 12pc of Alliance and is the largest shareholder, launched its attack last month, calling for the appointment of Anthony Brooke, Peter Chambers, and Rory Macnamara to the board. It accused the Dundee-based company of running an underperforming investment portfolio, spending too much on management pay and other internal costs, and failing to respond to governance concerns.The attack triggered an angry response from Alliance and Ms Garrett-Cox, who said she would not be “bullied” by Elliott.The backing of Aberdeen and Legal & General is a boost to Elliott but no guarantee it will reach the 50pc threshold on Wednesday. Around 70pc of Alliance shares are owned by small investors, although some proxies such as ISS and Pirc have backed the proposed new board members.On the other hand, the Dundee-based newspaper publisher DC Thomson, which owns 5.5pc of Alliance, is supporting Ms Garrett-Cox and the current board.
In the dark yet again
25 Apr 2015
Re: Alliance Trust responds to Elliott A... trader,Dreaming or nightmare? In my case LKH 'lowered the tone' so I thought I'd take it down from the gutter to the sewer. Not big, not clever but, hey ho, boys will be boys. No, never had the privilege of meeting, having tea (or dinner) with let alone frolicking with the fragrant Ms Fox.Though I would if I had the chance. She's on a sure thing with me.Regards,ITDYA
sansione
25 Apr 2015
Re: Alliance Trust responds to Elliott A... Totally agree with the " gobbledegook" comment but I think BS is more appropriate!! I would prefer to see something like " we invest in companies that are most likely to produce the highest returns for our shareholders " rather than all the PC nonsense.
