Two top-performing debt trusts have announced fresh issuance, further extending the sector’s lead in this area since the start of the year.  

In July, broker Winterflood reported that, despite representing less than 2% of net assets across London’s closed-end fund universe, debt trusts had accounted for nearly 40% of all fundraising activity since January.    

The numbers were correlative to strong demand for the niche, contributing to a rare 2% mean premium, while the average trust outside of debt languished at a discount of 13.2%.

The £275m CVC Income & Growth (CVCIG ) was first, sharing news of a placing and retail offer of both Euro and Sterling denominated shares.

At an extraordinary general meeting (EGM) to be held next month, shareholders will be asked to approve the issue of new shares representing up to 20% of the trust’s current share capital.

Additionally, the placing will involve reissuing shares held in treasury at a price equal to a 0.65% premium to the last published net asset value (NAV) per share, plus income, prior to its close. 

The board highlighted the strong appetite for CVCIG in recent months, noting 39 million shares have been reissued over the past 12, at an average premium of 0.36% since January. 

The news was followed by an update from the £886m TwentyFour Income Fund (TFIF ), which promised a placing and offer for subscription, along with an open offer of new shares for existing shareholders. 

The issue will be priced at up to a 2% premium to the NAV per share as on 21 October. 

The board convened an EGM later this month to ask shareholders to approve the issue along with amendments to the investment policy that expand the target geographies TFIF can invest in to include the US and Australia. 

Aza Teeuwen, partner and portfolio manager at TFIF, said: ‘The growth of the asset-backed securities (ABS) market, with increased issuance as banks have returned to traditional forms of funding, has improved the investment universe in our core markets of the UK and Europe and presented additional opportunities globally.’