Investors wary of Alliance Trust as vote looms

Tim Wallace
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ALLIANCE Trust bosses trumpeted the investment firm’s strong performance in the first quarter of the year yesterday, arguing it is beating the majority of its rivals across the world.

However, the firm’s shares slid 0.19 per cent. It comes at a crucial time for the business, which is locked in battle with activist investor Elliott Advisors.

Shareholders will vote at this month’s annual general meeting on Elliott’s plan to install three new directors on the board – Elliott says they are independent non-execs, who will actively challenge executives and help improve performance. But Alliance has stepped up its own search for one new director.

Alliance’s update shows total shareholder returns for the first quarter of 6.9 per cent, and net asset value total returns of 7.9 per cent – putting it in the top or second quartile in the sector.

“We are pleased with the strong performance of Alliance Trust during the period which we believe shows that our strategy is working,” said chief exec Katherine Garrett-Cox “The Trust has outperformed the global sector over the first three months of the year, a continuation of the work Peter Michaelis and Simon Clements have done since they were appointed in September of last year.”

But a source at Elliott said the firm is “full of contradictions... they constantly say Elliott are short-term investors, while [also] pointing to [their own] short-term metrics.”

Shareholder group PIRC also urged investors to vote for the three directors proposed by Elliott, and against a move to give Garrett-Cox a pay rise.