Saba Capital Management LP on Wednesday said it would continue to press for change at Herald Investment Trust PLC after shareholders voted against a proposal from the New York hedge fund.

In December, Saba, founded by former Deutsche Bank banker Boaz Weinstein, requisitioned general meetings of seven trusts and nominated representatives to replace existing directors.

On Wednesday, Herald Investment Trust said shareholders had ‘unanimously’ rejected the proposals by Saba.

Undeterred, Saba said it would ‘pursue the changes that we believe are necessary to improve the Trust after three years of poor returns and two decades of abysmal discount management by Katie Potts.’

In a statement, Saba said: ‘We appreciate the thoughtful engagement from fellow HRI shareholders in recent weeks, which only reinforces the dire state of the UK investment trust industry and need for Saba‘s presence in the market. Over a brief period, our campaign has already enhanced value for shareholders and incited positive change at HRI – and elsewhere in the UK market – as evidenced by discounts to net asset value narrowing and numerous trusts announcing shareholder-friendly actions.’

Saba said ‘more change is required,’ adding, ‘the industry’s failure to protect shareholders from losses due to poor performance and widening discounts cannot remain unaddressed.’

Herald Investment Trust said 65% of shareholders had voted against the plans.

Excluding Saba’s just under 35% stake, Herald Investment Trust said only 0.15% of shareholders had supported the resolutions.

‘This is a damning indictment of Saba’s proposals by the company’s non-Saba shareholders,’ the trust said in a statement.

Chair Andrew Joy said: ‘Today non-Saba shareholders have almost unanimously rejected Saba’s self-interested proposals.’

‘The fact that 99.78% of all votes cast by non-Saba shareholders were voted against Saba’s resolutions and in favour of the existing board provides a clear, complete and incontrovertible rebuttal of Saba’s attempt to take control of your company and change its strategy against the wishes and interests of its non-Saba shareholders.’

He added: ‘I very much regret that this episode has already cost shareholders money, which unfortunately we cannot reclaim from Saba.’

Joy pledged to engage with all shareholders, including Saba, as it moves forward.

Shares in Herald Investment Trust closed up 1.7% to 2,360.00 pence each in London on Wednesday.

Saba urged shareholders in the other six trusts to support its resolutions.

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