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Alliance Trust deal passed by shareholders

VotingShareholders sided with Alliance Trust over its future by voting in favour of its strategy, including buying out an activist investor.

Alliance Trust will be allowed to buy back Elliott Management’s almost 20% stake.

The terms, which set out that the shares would be bought from Elliott at a 4.75% discount to Alliance Trust’s net asset value in five tranches, was approved by 77% of the shareholders yesterday.

Senior managers at Alliance Trust were also successful in extending the trust’s share buy-back scheme for a further 5% of outstanding shares on the same terms as Elliott, gaining an almost unanimous vote of 97%.

Another important issue put to shareholders related to its investment strategy. The decision to let Willis Towers Watson appoint fund managers to run the firm’s investments was approved by 96% of shareholders.

After what has been a torrid time for one of the oldest investment trusts in the UK, shareholder approval of the board’s recommendations should now bolster the firm going forward. 

While Elliott may have been seen as a thorn in the side of Alliance Trust by some after its involvement resulted in the departure of senior figures including Catherine Garrett-Cox, the reshaping of the firm – which included selling its investment arm to Liontrust last year  – has met with shareholder approval. Elliott was the driving force behind these reforms.

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