Schiehallion (MNTN), the £1.7bn Baillie Gifford private equity fund mulling over a possible share issue, has reported on a “defining” year of progress.

Annual results show the closed-end fund delivered an underlying return of 32.6% in the year to 31 January with shareholders enjoying a 64.8% total return as the company re-rated from a steep discount to its current 7% premium above net asset value.

The turnaround came as the company fully invested all its cash and moved onshore to become a UK investment trust with a main market listing that enables it to be marketed to retail investors for the first time since launch in 2019.

Chair Rosemary Morgan said: “There is a prospect of some potentially generational IPOs” as she looked ahead to the plans for for at least three of its companies to float this year, including SpaceX in a possible $2trn US debut.

The three biggest contributors to performance were Italian digital product company Bending Spoons, space infrastructure giant SpaceX and Chinese social media company ByteDance. 

Fund managers Peter Singlehurst and Robert Natzler said the portfolio was fundamentally healthy with weighted average revenue growth of 54% last year that was more than two-and-a-half times that of the Nasdaq 100 US technology index.

“Furthermore, 62% of the portfolio is invested in companies that were profitable on a net income basis at 31 December 2025, while only 17% of the portfolio is exposed to holdings with a cash runway of less than two years, thereby giving us confidence about the overall financial resilience across the portfolio,” they said.

Our view

Matthew Read, senior analyst at QuotedData, said: “These are a good set of results for Schiehallion. Much of the 32.6% increase in NAV has been driven by valuation uplifts in a handful of large holdings – notably SpaceX and ByteDance – which provides a good illustration of Baillie Gifford’s philosophy that a relatively small number of holdings can drive the majority of returns over the long term and therefore it is important to identify such game changing stocks and back them with conviction. The shift to the UK main market as well as gaining UK investment trust status are welcome as they should allow a greater pool of investors to access to a pool of high growth private companies that is otherwise difficult to gain exposure to.”

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