American Hedge Fund Renews Offensive Against Scottish Investment Trust
American hedge fund tycoon Boaz Weinstein has reignited his campaign against a Baillie Gifford-managed investment trust, just weeks after shareholders decisively rejected his previous proposals at a crucial meeting. The founder of Saba Capital, who has been targeting UK investment trusts since 2024, has issued an open letter to investors in Edinburgh Worldwide Investment Trust (Ewit), repeating his longstanding concerns about the fund's performance.
Board Overhaul Proposed Following Shareholder Rejection
In his latest communication, Weinstein has proposed a significant overhaul of Ewit's board, suggesting shareholders appoint three independent directors to address what he describes as governance shortcomings. "A board's role is to protect investors' capital, address underperformance and portfolio management missteps, and prioritise value creation," Weinstein asserted. "Unfortunately, the current Board has fallen short across these responsibilities."
This renewed offensive comes despite a recent setback for Saba, which owns 30 per cent of Ewit shares. Last month, the hedge fund called a requisitioned general meeting where it tabled resolutions including one to replace the entire board with Saba's chosen candidates. The proposals were overwhelmingly rejected, with 93 per cent of voting shareholders (excluding Saba) opposing the hedge fund's plans. When Saba's own votes were included, the opposition still stood at 53 per cent.
Persistent Concerns About Investment Decisions
Weinstein's criticisms focus particularly on investment decisions made by Baillie Gifford fund managers, including the sale of Ewit's stake in Elon Musk's Space X shortly before the company achieved an $800 billion valuation in December. The hedge fund founder previously described this move as defying "commercial logic" and has now highlighted Musk's recent decision to merge Space X with his artificial intelligence venture xAI, which could add a further $700 billion to the combined entity.
"The recent reports that Space X plans to participate in the biggest merger of all time – ahead of a potential IPO later this year – only underscore the magnitude of the lost upside," Weinstein wrote in his Tuesday letter.
Broader Campaign Against Investment Trusts
This relaunched campaign represents the latest chapter in Saba's ongoing efforts to force radical changes across the investment trust sector. The activist fund began acquiring substantial stakes in heavily discounted listed funds over a year ago to push through governance reforms. Between 2024 and 2025, Weinstein proposed resolutions at nine closed-end funds, though most were rejected by investors following strong opposition from the investment trust industry.
Despite the recent shareholder vote, Weinstein remains convinced that dissatisfaction persists among investors. "After just 53.2 per cent of shares voted chose to stick with the status quo at the January 2026 requisitioned general meeting, we believe a meaningful portion of shareholders remain unhappy," he stated. "As a result, we believe shareholders would benefit from having a refreshed board composed of directors who possess objective viewpoints, hands-on investment management experience and an understanding of shareholders' perspectives."
Board Response and Future Engagement
Ewit's board has responded to the renewed criticism, with a spokeswoman stating: "Since shareholders rejected its resolutions on 20 January, the Board has made a number of attempts to engage with Saba and its advisers. On every occasion, Saba has failed to engage." The board has committed to updating shareholders on its plans in the near future, suggesting ongoing tensions between the investment trust's management and its largest shareholder.
The situation highlights the continuing challenges facing the UK's investment trust sector as activist investors seek to influence governance and investment strategies, creating a dynamic landscape of shareholder engagement and corporate defence mechanisms.
