Seraphim Space (SSIT), the world’s first space technology investment trust, is sending a share repurchase programme into orbit in a bid to bring its deep discount closer to Earth.

The fund has instructed its broker, JP Morgan Securities, to buy back up to 35.9 million shares representing almost 15% of share capital, but added it was not planning on fully utilising this authority.

Yesterday the shares were valued at just £62m, a deep 72% discount to the fund’s net asset value (NAV) of £211m, having traded at a small premium until April last year. Markets reacted positively to the news, sending the shares rising by more than 20%.

Peel Hunt said the buyback activity ‘may provide welcome relief to the share price’ given the discount is ‘one of the widest across the universe of investment companies we monitor’.

Other analysts were more lukewarm about the potential reach of the programme with Winterflood Securities questioning its longer-term impact.

‘While we think that this represents a good signal from the board of its confidence in the value embedded in the portfolio, we are uncertain about how much direct impact the repurchase programme will have, given the potential funding requirements of portfolio companies,’ it said.

At the end of March, cash reserves stood at £39m (18% of NAV) with the managers saying most of this would be deployed into the current portfolio.

The trust has failed to deliver stellar returns since its launch two years ago with the NAV falling 11.8% and the shares crashing 46.2% in the past year.

Manager Mark Boggett has conceded that he is struggling to get investors to understand the importance of the companies in the heavily-discounted portfolio.

In a commercial update today, the board pointed to ‘positive developments’ at portfolio companies. In the year to 30 June, 11 companies closed investment rounds, with the majority of rounds led by new external investors. SSIT has participated in two-thirds of them.

Six of the fund’s investments were made at higher valuations relative to previous rounds, with only one at a lower valuation.

SSIT expects to provide a more detailed update on trading once the second quarter reporting cycle is completed, ahead of publishing full-year results in October.