Richard Buxton’s £32m UK investment trust is to be wound down, with investors able to take their cash or ‘roll over’ into a global equity portfolio.
In a stock exchange announcement today (December 3), the board of the Jupiter UK Growth investment trust said it had struck a deal with Brown Advisory Funds which would allow investors to switch into its Global Leaders fund.
At the end of September, the board announced it was considering winding down the fund after admitting it was unlikely to be able to grow the trust in its present form.
The board today doubled down on the forecast, confirming it believed the best option for shareholders was to liquidate the company.
Investors will be offered a choice to either roll over their investment on a cost and tax efficient basis into new shares to be issued by the Brown Advisory Global Leaders fund — a sub-fund of Brown Advisory funds — or electing for a cash exit.
Brown Advisory Funds is an open-ended Irish-domiciled UCITs umbrella fund, encompassing sub-funds such as the Global Leaders portfolio.
The fund offered as a rollover to shareholders aims to achieve growth by investing in global equities, primarily “market-leading companies from across the globe”.
It is a concentrated portfolio of around 30 to 40 companies.
Earlier this year the trust's board had been considering its options following the trust's dire performance, with the prospect of firing Jupiter Asset Management to find a new manager on the table.
Following Jupiter’s announcement that it would be buying Merian Global Investors, however, the board decided to stay put on the condition star fund manager Richard Buxton be appointed as the trust's new manager.
But Mr Buxton, faced with the headwinds of the coronavirus pandemic and a struggling UK economy, was unable to save the tiny trust.
The trust is the absolute worst performer in the 12-strong UK All Companies AIC Sector across a one-year, three-year and five-year period.
Over five years, it has lost 33 per cent in share price terms compared to the sector’s positive 3.6 per cent return.
It has fared little better since Mr Buxton took over in February this year. Over six months, it returned just 11.8 per cent compared to the sector’s 25 per cent average.
Meanwhile, the Brown Advisory Global Leaders fund is among the top performers in IA Global Sector over three and five years, returning 55 and 97 per cent respectively.
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