Chrysalis (CHRY ) has paused making new investments until its annual general meeting next year as shareholders are divided on the future of the trust.

After speaking with investors who own a combined 58% of the listed fund, Chrysalis found that while some wanted to wait and allow assets to fully mature, it was ‘clear that a proportion of shareholders are seeking an orderly exit in a shorter timeframe’.

Pressure mounted in May when Chrysalis’s biggest shareholder, Asset Value Investors, asked for the next continuation vote to be brought forward from 2027. This was supported by other major investors representing 27% of the trust’s shares.

However, the board remained committed to its pre-arranged continuation vote due to the split in shareholders’ views.

It will launch a ‘detailed consideration of how best to evolve Chrysalis in response to the divergent shareholder views’, the results of which will be revealed in December, according to an announcement today. 

Based on last year’s timing, the next AGM is likely to fall in March 2026. 

Peel Hunt analyst Anthony Leatham said it was ‘unsurprising to see a divergence of opinion’ given the trust’s ‘persistently wide discount’.

The £608m private equity trust has not traded at or close to its net asset value since early 2022 and currently sits on a 29.9% discount, which has narrowed from its one-year average of 34.1%.

Leatham highlighted the trust’s strong performance over the past year, with shares climbing 39.6% on the back of strong growth from its two largest holdings – Starling and Klarna. These two financials account for 53% of the total portfolio.

Starling was boosted by improvements to its software throughout the year, as well as the acquisition of accounting and tax technology provider Ember over the summer.

Klarna, which went public in a New York listing last month, also saw its earnings increase 20% throughout the year after securing a number of strategic partnerships with the likes of Stripe, Nexi, Worldpay and JP Morgan Payments.

According to today’s announcement, shareholders are agreed on the attractiveness and inherent value of the portfolio, but are divided on whether to cash in these high returns sooner rather than later.

Longer-term performance has not been so strong – as the trust has moved from trading at a premium to a steep discount – with shares down 14.4% over the past five years following a steep drawdown in late 2021 through to 2022.