April Investment trust sector newsletter
Scottish Mortgage: SpaceX lift-off
Scottish Mortgage Investment Trust (SMT) has issued equity for the first time in almost five years. The £15.1bn Baillie Gifford trust issued 600k shares on 21 April and, owing to significant market demand, a further 850k the following day, with shares closing at a 1.9% premium to NAV on 22 April. This notably contrasts with SMT’s activity across 2025, a period in which the trust spent £1.7bn on buybacks to narrow a discount that was as wide as 23% in May 2023. As highlighted in our initiation note, successive upward revaluations of the trust’s top holding SpaceX have been significant catalysts in recent months – SpaceX’s percentage of SMT’s total assets grew from 8.2% at end-December 2025 to 19.3% in April 2026. Elon Musk’s company first entered SMT’s portfolio in 2018 and the position size was increased in 2021 – the combined c £200m investment is now worth over £3bn.
Anthropic, another of SMT’s unlisted holdings, also raised capital at an upward valuation and remains a potential 2026 IPO candidate – the AI developer made up 2.5% of SMT’s total assets at the end of April, up from 1.1% at the end of March. The trust’s managers remain confident in SMT’s prospects, citing a broad opportunity set across both developed and emerging markets.
Seraphim Space Investment Trust: Stratospheric returns
Seraphim Space Investment Trust (SSIT), a rare, listed pure-play spacetech vehicle, has been the top-performing investment company over the past year. With a share price total return of 298% since April 2025, the trust is planning to capitalise on its 46.5% premium to NAV and raise up to £350m through a C share issue, available to both institutional and retail investors.
The £480m trust’s performance has been driven by a string of successes across its portfolio, most notably Finnish satellite operator ICEYE, SSIT’s largest holding, which has delivered a fourfold increase in enterprise value since the trust’s initial investment in 2021. The board believes SSIT is exceptionally well-positioned heading into its fifth year, with the spacetech sector benefiting from higher European defence budgets, structurally lower launch costs, as well as growing demand from AI infrastructure and climate sustainability initiatives. Proceeds from any successful raise will be deployed into a pipeline consistent with the strategy executed since IPO.
Saba set to seize control of Edinburgh Worldwide
The high-stakes, 17-month battle for the future of Edinburgh Worldwide Investment Trust (EWI) has now reached its conclusion. On 10 April, shareholders rejected EWI’s proposed 100% tender offer, with 46.2% of votes cast in favour and 53.8% against; the votes against represented 36.8% of issued share capital and came almost entirely from a Saba-led opposition. The tender offer would have given shareholders a significant initial cash exit while retaining exposure to the potential future value of EWI’s largest holding, SpaceX.
Saba had already put forward an ‘enhanced liquidity proposal’, under which, if its nominees were elected, it would recommend that the new board offer shareholders the option to tender immediately at NAV less costs, tender after a potential SpaceX IPO or liquidity event, or remain invested. The AGM result on 30 April confirmed Saba’s victory, with its nominees appointed to the board and the incumbent directors departing. EWI attributed the outcome primarily to a material reduction in ownership by private wealth and retail shareholders, including previously engaged holders who had historically supported the board, as they faced the reality of Saba’s likely effective control of the company.
Saba’s victory represents a significant moment for the investment trust sector, opening the way for a change of manager and a fundamental shift in EWI’s strategy. Saba has indicated that, if selected as manager by the new board, it would seek to reposition EWI as a portfolio focused predominantly on UK-listed investment trusts, with a global mandate to invest in closed-end fund and investment trust opportunities. However, any material change in investment policy would require regulatory approval and a shareholder vote, so the precise future mandate is not yet settled.
Pensions Schemes Bill: A structural tailwind for the sector
In a welcome development for the investment trust sector, the government amended the Pensions Schemes Bill on 29 April to explicitly include investment companies, completing its passage through both the House of Commons and House of Lords. Pension schemes will now be able to use investment trusts to meet any requirement to invest in private assets, a change that gives them the confidence to allocate to the sector in pursuit of their Mansion House commitments. The AIC, which had campaigned persistently for the amendment alongside Baronesses Altmann and Bowles, described it as a common-sense outcome. At a time when the sector has faced sustained headwinds from wide discounts and activist pressure, this legislative recognition of investment companies as a legitimate vehicle for private asset exposure represents a meaningful structural positive.
On the road:
Coming up: Edison will host a webinar with Baker Steel Resources Trust on 6 May. The Canadian General Investments roadshow visits Dublin on 11 May and York on 14 May. Looking further ahead, the VietNam Holding roadshow stops in Dublin on 12 June and Zurich on 22 June.
Two key industry dates for the diary: the Edison Growth Conference on 12 May, followed by the AIC Dinner on 14 May.
