Saba takes aim at Gore Street Energy Storage

It becomes the second activist investor in the £294m trust alongside RM Funds.

Saba Capital has taken a 5% stake in Gore Street Energy Storage (GSF ), becoming the second activist investor to target the £294m trust alongside RM Funds. Together, the two own 11% of shares in the company.

The board has survived two previous attempts to oust the directors, firstly in a requisitioned meeting by RM Funds in August, then at its annual general meeting (AGM) in September. Almost a third (30.7%) of votes were cast to remove chair Pat Cox and director Caroline Banszky, dropping to 27% and 22% respectively at the following AGM.

However, unrest amongst shareholders has mounted in the weeks since, with Investec analyst Ben Newell claiming the board had not disclosed all fees paid to the management group. He highlighted ‘serious concerns’ over the £5m payments not disclosed in its March accounts – doubling the amount it claimed to have paid the manager.

Gore Street disputed these accusations, calling them ‘inaccurate and misleading’ in a stock market filing last week. Shortly after, however, it pledged to update payment disclosures more frequently to ‘ensure full transparency’ and accelerated plans to replace the board.

It had originally planned to refresh the current board next year after pressure from RM Funds, but the deadline was moved forward.

The new position taken by Saba Capital could apply further pressure on the trust, as the US hedge fund has done with several other UK investment companies. It attempted to oust the boards of seven investment trusts in requisitioned meetings earlier this year, which all ended in failure.

The firm, run by Boaz Weinstein, has continued to build positions in discounted investment companies since, most recently taking a 5% stake Molten Ventures (GROW ).

Saba Capital revealed plans in September to launch an exchange-traded fund (ETF) aimed at discounted trusts in the UK’s closed-end sector.

Gore Street Energy Storage currently sits on a steep discount of 43.5%, with its share price total return down 34.5% in the past three years.