ALLIANCE TRUST PLC (ATST)

ALLIANCE TRUST PLC (ATST)

Blog posts

Recent Annual Reports and Trust Discounts

After the news over the weekend, it’s clearly going to be another very bad day on stock markets. One rare riser initially was Ten Entertainment Group (TEG) despite the...

Brexit Investment Strategies

Investors may have noticed that the pound is in free fall and heading towards US$1.20. That’s near the low after the initial Brexit vote. Pundits, not that they can be relied on for forex forecasts, suggest it could go lower now that we seem to be heading for a “no-deal” Brexit. With the pound falling, and potential damage to the UK economy from a hard Brexit, investors should surely have been avoiding companies reliant on UK sales, or UK consumers, or those ...

Alliance Trust Savings Sold

Alliance Trust (ATST) has sold its Alliance Trust Savings (ATS) subsidiary to privately-owned company Interactive Investor. The ATS investment platform was always a peculiar business for a traditional investment trust to be holding. It was also consistently loss-making and reported an operating loss of £19.3 million in 2017 after a big write down of intangible assets. The directors valued the ATS business at £38.3 million in the 2017 accounts and Interactive Investor are paying £40 million for it but it looks ...

GB Group, Social Media, Rightmove and Alliance Trust

Yesterday I attended the Annual General Meeting of GB Group (GBG) in Chester. An absolutely horrendous road journey both there and back mainly due to road works as far as I can tell. But my satnav took me on the M25, M11, A14, M6, M54 and numerous minor roads on the way there from south-east London, and the M6, A50, M1, A14, M11, M25 and other minor roads on the way back. A typical example of how the UK road network ...

Alliance Trust, Katherine Garrett-Cox and Perverse LTIPs

I have previously commented positively on the outcome of the “revolution” that took place at Alliance Trust (ATST) as reflected in their latest accounts which were recently published. That revolution resulted in the departure of former CEO Katherine Garrett-Cox who resigned in February 2016. The latest Annual Report shows that she is still being paid large amounts though. For example, total “single figure” remuneration for the 2016 calendar year is given as £1,305,000 and was £832,000 for 2017. She is likely to be ...

The Dangers of Share Tipping, Alliance Trust and AIM Regulation

Share tipping is a mug’s game. Both for the tipsters and their readers. More evidence of this was provided yesterday. Investors Chronicle issued their “Tips of the Week” via email during the day. It included a “BUY” recommendation on Conviviality (CVR). Unfortunately soon after, the company issued a trading statement which said the forecast EBITDA for the current year (ending 30th April) will be 20% below market expectations. Conviviality is a wholesaler, distributor and retailer of alcohol and it seems there was ...

Perverse LTIPs and Alliance Trust (ATST)

Alliance Trust Vote – A Victory for Private Investors and ShareSoc

Today Alliance Trust shareholders voted to support the Board’s proposals to change the investment management arrangements and to buy out Elliot. This is surely a major win for private...

Alliance Trust Press Release

ShareSoc has issued the following press release: Alliance Trust have convened a General Meeting on the 28th February. It includes 4 resolutions covering the change in investment approach and the proposed share buy back of shares held by Elliott. Our recommendation is that shareholders vote "FOR" all the resolutions. ShareSoc is issuing this press release because we understand that some institutional investor advisory services have expressed some concerns about the proposals. The Alliance Trust Shareholder Action Group which has been supported by ShareSoc is satisfied ...

Alliance Trust Voting Recommendations

ShareSoc has issued the following note to supporters of the Alliance Trust Shareholder Action Group: Shareholders in Alliance Trust should have received a Notice of a General Meeting on the 28th February. It includes 4 resolutions covering the change in investment approach and the proposed share buy back of shares held by Elliott. Our recommendation is that shareholders vote "FOR" all the resolutions. The Alliance Trust Shareholder Action Group is satisfied that the new Board of Directors has made good progress in revitalising the ...

Alliance Trust Shareholder Forum

Alliance Trust Shareholder Forum Yesterday (25/1/2017) Alliance Trust Plc (ATS) held the first of three meetings for shareholders to explain the outcome of the "strategic review" undertaken by the board of directors and the future investment management arrangements. This first meeting was in London and attended by a couple of hundred shareholders many of whom posed good questions. More on the questions and answers below, but first let me give you some impression of the mood of the audience and an overview of ...

Alliance Trust Strategic Review Announcement

The following note has been issued by ATSAG following the announcement this morning from Alliance Trust: Alliance Trust Shareholder Action Group (ATSAG) Update No. 13 – Outcome of Strategic...

Alliance Versus RIT Capital

Readers will no doubt be aware from the national media and communications with shareholders that RIT Capital have approached Alliance Trust about a possible merger. The press have noted the problems faced by Alliance in the last few years such as the persistently high discount and the attack by Elliot Advisors (supported by ATSAG/ShareSoc of course) that resulted in board changes. RIT shares have traded at a premium to net asset value recently and media comments tend to generally be positive ...

Alliance Trust and RIT Capital

Several newspapers reported this morning that Alliance Trust (ATST) has been approached by RIT Capital Partners (RCP) about a possible merger. Both companies are listed investment trusts favoured by private investors. Alliance Trust has been going through some difficult times of late after a period of poor relative performance resulting in a high discount to net asset value (currently over 10% according to the AIC despite an active share buy-back programme whereas RCP is on a 6% premium at the time ...

Alliance Trust Investor Forum Report

Yesterday I attended the Investor Forum held by Alliance Trust in London. There were about 350 attendees with the usual audience of investment trust shareholders, many of whom had held the shares for a very long time from talking to a few of them. I pick out below some of the highlights (a full report of the meeting will be distributed to those who have registered for the Alliance Trust Shareholder Action Group (ATSAG - see https://www.sharesoc.org/alliance.html ). Chairperson Karin Forseke covered ...

Alliance Trust Announcement and ATSAG Response

Alliance Trust Plc have today announced a number of changes "to enhance shareholder value" as they put it. It includes a more focussed investment mandate, a reduction in costs, a commitment to narrowing the discount, a revised dividend policy and a simplification of the corporate structure. The Alliance Trust Shareholder Action Group (ATSAG), supported by ShareSoc, has generally welcomed the changes. You can read the full comments issued by ATSAG in this press release: https://www.sharesoc.org/pr70alliancenews.html Roger Lawson

Elliott Raises Stake in Alliance Trust

Elliott Advisors have raised their stake in Alliance Trust to 14%. After a battle before the last Annual General Meeting of Alliance, the company effectively conceded defeat by appointing two new non-executive directors as suggested by Elliott. But the issues raised by Elliott of a high share price discount to net asset value, and long-standing poor performance have not gone away – the discount currently stands at about 12%, much higher than most generalist investment trusts. Indeed many trusts are now ...

ShareSoc Deplores Withdrawal of Personal Crest Membership by Brokers

ShareSoc has issued the following Press Release: Following the takeover of Stocktrade by Alliance Trust Savings (ATS), the latter have decided to withdraw support for Personal Crest Membership from their clients. Clients will either have to transfer into the ATS nominee service, turn their holdings into paper share certificates (a truly archaic form nowadays which are soon to be outlawed by an EU Directive), move to another broker or liquidate their holdings. This continues a recent trend for stockbrokers to terminate the ...

Alliance Trust Results

Yesterday (23/7/2015) Alliance Trust (ATST) announced its results for the six months to 30 June 2015. The results were disappointing with a net asset value (NAV) total return of 1.4% and a share price total return of 2.7%. Based on data published by Morningstar the NAV and share price total returns were below comparable figures for the company's peer group. The Morningstar peer group NAV return was 4.26% and share price return 5.53%. The Alliance Trust discount has, however, fallen from ...

Defeating Shareholder Democracy at Alliance Trust et al

The existing shareholding arrangements in public companies, with many investors in nominee accounts, now effectively frustrate shareholder democracy. Alternatively they make it either very difficult in practice, or enormously expensive. Let's look at a couple of examples where ShareSoc has some recent experience of requesting share registers - Alliance Trust and Rensburg AIM VCT. In terms of the size of the company and numbers of shareholders Alliance Trust is one of the larger public companies. It has recently come under attack from ...

Charles Stanley and Alliance Trust

Stockbroker Charles Stanley (CAY) today announced their Preliminary Results for the year ending in March, and also announced they had exchanged contracts for the disposal of the CSS Division. The results were somewhat better than expected, but there was a loss before tax of £6.1 million, albeit with positive underlying earnings per share. Charles Stanley have a considerable retail investor client base and it is always worthwhile for investors to keep an eye on the financial position of their stockbroker. The ...

Alliance Trust Stocktrade Acquisition and Sexism in the City

Yesterday (15/5/2015), Alliance Trust announced the acquisition of the Stocktrade service from Brewin Dolphin which will be integrated into the Alliance Trust Savings (ATS) subsidiary. The acquisition will cost ATS £14 million, and that cost plus an additional £8m of regulatory capital will be funded by the parent company with an injection of equity. This move will anger many shareholders of Alliance Trust who have expressed concerns about the expansion plans for the Alliance Trust subsidiaries, the capital required and the ...

Shareholder Action Group Launched for Alliance Trust

Following the Annual General Meeting of Alliance Trust (ATST) where the Board conceded the appointment of new directors subsequent to the requisition by Elliott Advisors, ShareSoc has been encouraged by a number of private investors to support a shareholder action group to represent their interests. Many investors still have concerns about the strategy of the company and about some aspects of its operations. A shareholder action group has therefore been launched and investors can register their interest on this web page: https://www.sharesoc.org/alliance.html Roger ...

Alliance Trust AGM – Will Dundee cake suffice?

These are some initial impressions of the Alliance Trust AGM in Dundee yesterday - a full report can be found here. It was not quite as exciting as it might have been after the company conceded defeat the previous day and agreed to accept two of the new directors nominated by Elliott, who then withdrew their resolutions. Alliance said it was a "compromise" but most commentators saw it as a tactical withdrawal at best. All Alliance have got is a "non-disparagement" agreement ...

Governance in Investment Trusts – Alliance Trust, Baronsmead VCT 3 and the Core VCTs

The battle for the soul of Alliance Trust continues - or so their Chairman would have it. But even institutional proxy advisors ISS and PIRC have now come out in support of Elliott Advisors and their resolutions to appoint three new directors at the AGM on the 29th April. Alliance have said they are looking for a new truly independent non-executive director, but will they be anyone who is likely to disagree with the existing board or take a contrary view? ...

An Analysis of the Alliance Trust Defence

ShareSoc has now issued a fuller analysis of the case for change at Alliance Trust, and the defence notes issues by Alliance Trust. It is present in this document on our web site: https://www.sharesoc.org/ShareSoc_Alliance_Trust_Analysis.pdf This is what is said in the conclusion of that document:  We think it was perfectly reasonable for Elliott Advisors to take up their worries with Alliance and propose directors if they considered the issues they have raised were not being dealt with. Requisitioning resolutions is simple democracy upon ...

Alliance Trust – ShareSoc Press Release

ShareSoc has issued the following press release after talking to both representatives of Alliance Trust and Elliott Advisors. If you have any views on this matter please let us know, and we would particularly like to hear from any holders of Alliance Trust shares (for publication or privately if you prefer). This is one company where private shareholders are in the majority but it will be interesting to see how many can and do vote. It may prove an interesting example of how ...

Alliance Trust Under Attack

Alliance Trust, an investment trust held by many private investors, is coming under attack for poor performance and poor corporate governance for a second time. It defeated a campaign by Laxey Partners back in 2011, and although their AGM resolutions were defeated the company did subsequently make some changes - for example more share buy-backs were done to help control the share price discount. This time it is the turn of Elliott Advisors who control over 12% of the shares. They ...

AGM Reports

Alliance Trust (ATST) AGM 2017

The AGM, which was held in Dundee on Thursday 27th April, was very well attended. The formal proceeding were preceded by a short presentation from the Chairman and from Peter Michaelis, the manager who had been responsible for the Trust's portfolio until the end of March 2017, i.e. while it was still being managed by Alliance Trust Investments. There were no particular surprises in either presentation although Lord Smith did mention that Alliance Trust Savings' progress, while in the right direction, ...

Alliance Trust (ATST) AGM 2016

Good attendance - over 300 shareholders. Opening remarks by Lord Smith explained why he had accepted the Chairmanship. a) Company faced challenges. b) What needed to be done had been identified. c) A plan was in place. Lord Smith's final check was to make sure that the "people" could deliver and the answer was that they could. Against the background of the Trust's long established reputation (deep, rich heritage) Lord Smith felt he could add value. The Trust mattered to 102,000 shareholders, 300 staff, and the 60 ...

Alliance Trust (ATST) AGM Full Report 2015 – Will Dundee cake suffice?

The following blog post was published on the 30th April 2015 which gives a good summary of events at the AGM. What follows afterwards is a more detailed report. Note that for a full explanation of what the dispute was about at Alliance Trust see this note on our web site: https://www.sharesoc.org/ShareSoc_Alliance_Trust_Analysis.pdf and RNS announcements that were issued by both parties during the battle. These are some initial impressions of the Alliance Trust AGM in Dundee. It was not quite as exciting as it might have been ...

ShareSoc News

Alliance Trust Vote – A Victory for Private Investors and ShareSoc

PRESS RELEASE 90 01/03/2017 Yesterday Alliance Trust shareholders voted to support the Board's proposals to change the investment management arrangements and to buy out Elliot. This is surely a major win for private investors and for the stance taken by ShareSoc and the Alliance Trust Shareholder Action Group (ATSAG) which ShareSoc has supported over the last 3 years. ShareSoc wholeheartedly backed the Board's proposals. Alliance Trust can now move forward. But it was a close run thing as proxy advisory services who advise ...

Alliance Trust Voting Recommendations

PRESS RELEASE 88 17/02/2017 Alliance Trust have convened a General Meeting on the 28th February. It includes 4 resolutions covering the change in investment approach and the proposed share buy back of shares held by Elliott. Our recommendation is that shareholders vote "FOR" all the resolutions. ShareSoc is issuing this press release because we understand that some institutional investor advisory services have expressed some concerns about the proposals. The Alliance Trust Shareholder Action Group which has been supported by ShareSoc is satisfied that the new ...

Alliance Trust Shareholder Action Group welcomes changes announced by Alliance

PRESS RELEASE 70 1/10/2015 The Alliance Trust Shareholder Action Group (ATSAG), supported by ShareSoc, welcomes the changes announced by the company today. Our comments are as follows: The separation of investment management operations into a more independent management organisation (Alliance Trust Investments - ATI) so as to make it more accountable is sensible. It is being given a clear mandate to perform and the announcement suggests further changes might be considered, such as outsourcing of investment management, if it does not. The demotion ...

ShareSoc Deplores Withdrawal of Personal Crest Membership by Brokers

PRESS RELEASE 68 24/8/2015 Following the takeover of Stocktrade by Alliance Trust Savings (ATS), the latter have decided to withdraw support for Personal Crest Membership from their clients. Clients will either have to transfer into the ATS nominee service, turn their holdings into paper share certificates (a truly archaic form nowadays which are soon to be outlawed by an EU Directive), move to another broker or liquidate their holdings. This continues a recent trend for stockbrokers to terminate the provision of a ...

Shareholder Action Group Launched for Alliance Trust

PRESS RELEASE 65 (12/5/2015) Following the Annual General Meeting of Alliance Trust where the Board conceded the appointment of new directors subsequent to the requisition by Elliott Advisors, ShareSoc has been encouraged by a number of private investors to support a shareholder action group to represent their interests. Many investors still have concerns about the strategy of the company and about some aspects of its operations. A shareholder action group has therefore been launched and investors can register their interest on this ...

ShareSoc Comments on the Proposals for Alliance Trust

PRESS RELEASE 64 (24/3/2015) ShareSoc makes the following comments on the requisition to appoint three new non-executive directors to the board of Alliance Trust by Elliott Advisors. We do this from the stance of an independent not-for-profit organisation whose objective is to represent the interests of private shareholders.  Many of our members have an interest in investment trusts which generally provide a low cost and diversified way of investing in the stock market. But the issues that have arisen at this Trust such ...

ShareSoc supports the proposals advocated by Laxey Partners at Alliance Trust

PRESS RELEASE 04 (21/04/2011) The UK Individual Shareholder Society (ShareSoc) has considered the issues raised by Laxey Partners in relation to Alliance Trust and the Resolutions proposed by them at the forthcoming AGM. We agree with the proposals by Laxey for the introduction of a Discount Control Mechanism (DCM) and the change to the voting arrangements for shares held in the Alliance Trust Savings Schemes. Our position is that we believe that it is not in shareholders’ interests to have a consistently wide ...

Corporate Remuneration Reports

Alliance Trust AGM and Voting Recommendations- ATSAG Update 10

Investors in Alliance Trust should now have had a chance to read the Annual Report. We commented on the financial results reported therein in a previous note. This note covers other information provided in the Annual Report and gives some voting recommendations (we already indicated in the previous note that we supported reappointment of the existing board directors so only the other resolutions are covered herein). There are two votes to consider on Remuneration - Resolutions 2 and 3. The first of those is an advisory vote ...