The manager of ThomasLloyd Energy Impact Trust (TLEI ) has urged fellow shareholders to vote in favour of continuation on 24 August and proposed a new board to replace the current non-exec directors who have lost confidence in the ThomasLloyd Group.

The Zurich-based ThomasLloyd Group’s more detailed rebuttal this morning claimed that the board, chaired by Sue Inglis, had not acted in shareholders’ best interests when it suspended the shares in April and called for shareholders to vote against the trust’s continuation. 

It said suspending the emerging market renewable trust’s shares was the most extreme option available to the board when the trust abandoned construction of the 200MW Indian SolarArise project amid rising costs.

It added that the board ‘ought to have known’ costs were continuing to evolve, pricing was falling and that temporarily writing down the project’s value was the most sensible approach, especially given the project made up only 5% of assets.

ThomasLloyd Group said that the board’s decision to adjourn the June AGM before the continuation vote because the 2022 annual results had not been published was ‘invalid’.

It said Inglis refused demands for a poll on the decision from TLG and its affiliates, which have a 15% stake in the trust, and shareholders representing a majority. The UK Foreign Office is the largest shareholder with an 18% stake.

TLG also noted the reasoning behind the board’s decision to suspend voting was ‘flawed’ because an auditor would want to be confident a continuation vote would pass, adding that passing the vote would be a critical step to publishing the accounts and lifting the share suspension.

ThomasLloyd said that by recommending against continuation, the current board was publicly stating it did not have confidence in the future of the trust and therefore could not be permitted to oversee the completion of the audit of the 2022 accounts or the lifting of the suspension. It added that a windup would permanently destroy shareholder value.

It said that the proposed new independent non-executive directors have the requisite skills and experience to navigate the complexities created by the current TLEI board with a view to steadfastly dedicating themselves to aiming to lift the suspension as soon as possible.

The proposed board:

Chair, Christian Yates. He has experience in the renewable energy sector and governance of investment trusts, currently chairing Gresham House Renewable Energy VCT2 (GV2O) and is a non-executive director of Echo Energy (ECHO).

Russell Downs as chair of the audit committee. A ‘noted corporate turnaround professional’ who has protected the interests of stakeholders of Lehman Brothers and Carillion.

Martyn Everett, a restructuring professional, who has turnaround experience with Taylor Wimpey (TW) and Interserve (IRV).  

Sarah Day, a chartered accountant with experience of FCA-regulated companies as they successfully navigated complex regulatory and reporting environments.

‘Shareholders have much to gain by voting in favour of the continuation of TLEI and we offer the fresh start TLEI’s governance requires,’ Yates said. ‘If we are appointed immediately after the 24 August general meetings, we intend to finalise the 2022 accounts and the 2023 interim accounts as soon as possible and publish within two weeks of appointment a detailed roadmap for this.’