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Small-cap veteran Boyle seeks to oust board of Athelney Trust

7 January 2019

Robin Boyle, former managing director and fund manager of small-cap minnow Athelney, looks to regain control of board he quit three months ago and proposes moving trust to Gresham House.

The dispute over the future of smaller company minnow Athelney (ATY) has revived with Robin Boyle, the £5 million investment trust’s founder, calling a shareholder meeting to reinstate him to his previous roles as managing director and fund manager.

Boyle, who announced his resignation on Twitter in October after a disagreement with directors, is seeking authorisation from an extraordinary general meeting to restructure the board and remove Dr Emmanuel ‘Manny’ Pohl, the Australian fund manager who succeeded him as MD and investment director.

Boyle, Athelney’s biggest shareholder with a 20.8% stake, wants to move the trust to the investment platform of Gresham House (GHE) in order to receive help with marketing and succession planning.

Boyle, who established Athelney in 1994 to invest in the Alternative Investment Market (AIM), is 74. He said he would shortly write to shareholders with further details before the EGM on 22 January.

‘I have called the meeting because I believe it is crucial to continue to look to maximise value for all shareholders,’ Boyle said in a statement.

‘There is the attractive potential of growing the trust in size, while maintaining the successful investment approach and reducing costs.’

Referring to Pohl, whose Global Master Fund owns 17.6% of Athelney, Boyle said. ‘I do not see how Athelney’s investment strategy can be carried out by someone who spends the majority of his time some 10,000 miles away in a different time zone as is the case currently.’

Boyle criticised the board for not disclosing his requisitioning the EGM when it launched a tender offer to buy back shareholders’ shares in the week before Christmas. He is also seeking to remove Simon Moore, the senior independent director who replaced Pohl as chairman in October.

Moore, a senior investment manager at Seven Investment Management, claimed Boyle’s sudden resignation had been ‘upsetting’ and left the board ‘rushing around’ to put plans in place to protect shareholders and the value of the trust.

Jemma Jackson, an investment public relations specialist, joined the board as a non-executive director in December.

Moore said the board had been surprised by Boyle's move given they had discussed a timeline with him to step back.

‘We hoped he would stay on as a director, given how well he had done with raising the trust’s dividend for 15 years,’ Moore told Investment Trust Insider. ‘Maybe he’s realising he made a mistake in resigning.’

Moore defended Pohl’s role as investment director saying he had a ‘good process in place’ and managed three investment companies in Australia.

He was unaware of Boyle’s proposals to work with Gresham House, a former investment trust that has become an alternative fund manager overseeing LMS Capital (LMS), Gresham House Strategic (GHS) and the recently launched Gresham House Energy Storage Fund (GRID).

In his statement Boyle said it was understood he would stay on as a non-executive director for a period of time but that this line was left out of a stock exchange statement.

Paradoxically, the uncertainty over Athelney’s future has helped it withstand the stock market decline of the past three months. From trading at a discount of 13% below net asset value, the shares have re-rated and moved to a 7% premium above NAV at 255p.

Nevertheless, it has one of the worst long-term track records in the AIC UK Smaller Companies sector, generating a 243.6% total return to shareholders, below the 548.6% sector average and the 270.8% of the FTSE Small Cap index.

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