European Opportunities (EOT ) is offering to tender a quarter of its shares by the end of January as it responds to criticism levied by activist investor Saba Capital.

The board, which previously tried to sway investors with a conditional tender offer, is now proposing to repurchase 25% of the shares at the prevailing net asset value (NAV), adjusted for costs, minus 2%.

The conditional tender offer, which was announced in October, will still be an option. That offer will allow investors in the £778m investment trust to tender 25% if NAV growth does not equal or outperform the MSCI Europe index in the three years to 31 May 2026.

Following the initial announcement of the conditional offer, Saba (which has been building significant stakes in investment companies) made its first public move. The hedge fund issued a letter to the trust’s chair Matthew Dobbs, saying it would vote against the continuation of the trust at the upcoming meeting and urging other shareholders to do the same.

Paul Kazarian, portfolio manager at New York-based Saba, which owns 5% of the trust, said the conditional offer was ‘woefully insufficient’ and noted the fund run by Alexander Darwall has underperformed its benchmark by 40% over the last five years.  

Shareholders will vote on the two proposed tender offers at the company’s annual general meeting on 15 November, which will also see them cast their vote on continuation. Along with the board, advisory firm Institutional Shareholder Services is recommending shareholders vote in favour of the trust continuing.  

Peel Hunt analyst Thomas Pocock said the new tender offer was a ‘significant improvement’ but ‘it remains to be seen if this is enough’ to sway shareholders.

The top shareholders in the company are 1607 Capital Partners, Allspring Global Investment and City of London Investment Management, who own 13%, 12.6% and 6.6%, respectively. Darwall himself owns 5.5% of the shares.

The trust is currently trading a 9.3% discount to NAV.