Industry governance experts on Friday called on shareholders in several investment trusts to vote against plans proposed by US hedge fund Saba Capital Management LP.

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

A war of words between Saba and the seven trusts has resulted. On Wednesday, shareholders in Herald Investment Trust PLC voted against the plans from the New York-based firm.

Despite this, Saba said it will continue to push for change stating ‘the industry’s failure to protect shareholders from losses due to poor performance and widening discounts cannot remain unaddressed.’

On Friday, Keystone Positive Change Investment Trust PLC said ISS had recommended rejection of the proposals, stating Saba has not ‘presented a compelling case for change, let alone a case for a majority position on the board and a strategy overhaul.’

This follows the recommendation from Glass Lewis who also recommended shareholders vote against the plans.

Glass Lewis and ISS on Friday also urged shareholders in Henderson Opportunities Trust PLC to vote against the plans.

Glass Lewis and ISS were joined by PIRC on Friday in urging investors at Baillie Gifford US Growth Trust PLC to reject the proposals. On Thursday, Glass Lewis called on shareholders in The European Smaller Companies Trust PLC to spurn the plans.

Shares in The European Smaller Companies Trust PLC rose 0.3% to 177.10 pence in London on Friday. Baillie Gifford US Growth Trust PLC was 0.8% lower at 264.00p. Keystone Positive Change Investment Trust PLC was unchanged at 251.00p. Henderson Opportunities Trust PLC was down 0.5% at 223.00p.

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