Investments  

Investment trust merges with smaller rival

Investment trust merges with smaller rival
 Troy Income and Growth is managed by Francis Brooke

The board of the £250m Troy Income and Growth investment trust, which is managed by Francis Brooke, has confirmed its takeover of the much smaller Cameron Investors trust. 

In an announcement to the stock exchange yesterday (November 18), the board confirmed that the £11m of assets held in the Cameron Investors trust will be merged into the Troy fund, with shareholders seeing their shares exchanged for Troy shares. 

The agreement was accepted by Cameron Investors trust shareholders on November 18 and will take effect from November 20. 

The Cameron Investors trust was established in 1957 as an investment vehicle for a number of families, and a year ago became an investment trust listed on the London Stock Exchange. 

The Troy Income and Growth trust has 88 per cent of its capital invested in UK equities, nine per cent in US equities and 3 per cent in European shares. 

The trust has returned 14 per cent over the past year, compared with 5 per cent for the average trust in the AIC UK Equity Income sector in the same time period. 

Mr Brooke said in a letter to shareholders published on November 14 the recent strength of sterling had prompted him to invest in companies that generate most of their revenue from overseas, as the strong performance of the currency has made those companies, such as Diageo and Unilever, cheaper, and so a buying opportunity. 

The Troy Income and Growth trust trades at a one per cent premium to its net assets, though this may change with £11m of new shares about to enter the market as a result of the merger.

david.thorpe@ft.com

What do you think about the issues raised by this story? Email us on fa.letters@ft.com to let us know.