Liontrust pulls ESG trust IPO after limited interest

Liontrust pulls ESG trust IPO after limited interest

Liontrust will not proceed with the initial public offering (IPO) of its sustainable investment trust (ESGT).

The group said it had received significant support from private investors but the demand did not reach the minimum investment of £100m, as set out in the prospectus.

Liontrust announced the IPO in May this year, and said the trust would invest in 25 to 35 companies around the world that it deemed sustainable.

The trust’s portfolio would have been managed by Peter Michaelis, Simon Clements and Chris Foster, currently part of Liontrust’s sustainable investment team.

John Ions, chief executive of Liontrust, said: “The strength of interest from individual investors shows the potential there was of building ESGT over the next few years. 

“We received significant commitment from investors for ESGT post launch but not enough for the IPO. This reflects the challenging market conditions for fundraising for investment trusts.”    

He said the firm would continue to focus on building the open-ended funds run by the sustainable investment team which is managing £10bn.

“We are disappointed we won’t get the chance to repay their faith through an investment trust after everyone worked so hard to secure its launch.”

Jason Hollands, managing director at Tilney, said it was disappointing news.

“This would have brought something refreshingly new to the UK investment trust sector, managed by a highly credible team with a strong track record and a well-articulated approach to sustainable investing. 

“Liontrust will at least be able to continue to build on their strong open-ended ESG franchise.”

He added: “There has been such a proliferation of new ESG funds in recent years you have to wonder whether this is a sign of product fatigue in this space?”