General meetings may be imperfect, but are the key to shareholder democracy.
Private equity management, hedge funds and other unlisted vehicles hide behind layers of complex ownership and answer only to themselves.
Listed companies offer investors, retail and fund managers the chance for a say.
Most often, the annual meetings of investment trusts are held quietly, few red flags are raised, and one would be hard pressed to know what transpired.
Today’s session of the £1.4billion Herald Investment Trust in the City, the first of ‘Seven Miserables’ being targeted by US marauder Boaz Weinstein, allows investors to be heard.
Weinstein’s group Saba has built a substantial 27.8 per cent stake, according to Refinitiv data.
Short-termist: Today’s AGM of the £1.4bn Herald Investment Trust, the first of ‘Seven Miserables’ being targeted by Saba Capital’s Boaz Weinstein, allows investors to be heard
It sets out with a formidable advantage in its effort to substitute the current directors, headed by chairman Andrew Joy, with its own placemen.
In the past, Alliance Trust, Electra and the sector’s grandparent Foreign & Colonial have all been boarded by rapacious predators.
It is not just trusts which need to publicly defend themselves.
City grandees need to use today’s general meeting, and those coming down the pike, to stand up a marbled pillar of UK share ownership.
Czech debt
Postal workers, mainly represented by the Communication Workers Union, need to carefully consider whether they can trust the undertakings made by the Czech Sphinx Daniel Kretinsky.
He has promised to increase pay and protect jobs should he succeed in his £3.6billion bid for the Royal Mail.
They are not alone. Business Secretary Jonathan Reynolds – who, in common with much of Labour’s front bench, virtually has no commercial experience – ought to consider whether he has been bamboozled by the billionaire’s sweet talk on future investment.
Debt-fuelled deals when interest rates remain stubbornly high rarely work out for the best.
Dutch postal service PostNL, in which Kretinsky’s EP Group owns a 29 per cent stake, this week issued a profits warning and asked for government help.
Turning around mail delivery services, even without a debt mountain, is not easy.
Labour has enough problems with railways and Thames Water without having to worry about Royal Mail should it all go wrong.
Kretinsky has emerged as a potential buyer for German state-owned utility Uniper with a price tag of £16bn. Becoming part of an ever-larger debt-fuelled empire will be disastrous for Royal Mail.
Courting growth
Finally, something the City can cheer from Rachel Reeves.
The Chancellor’s submission to the Supreme Court warning of ‘considerable economic harm’ should there be unlimited payouts to consumers caught unawares by hidden commissions on car finance is designed to limit losses to the financial sector.
Payment Protection Insurance-style payouts – which reached more than £38billion – could stymie lending and the growth agenda.
Judges need to resist temptation to become part of compensation culture and revert to the contract law concept of ‘caveat emptor’: let the buyer beware.
Kretinsky has emerged as a potential buyer for German state-owned utility Uniper with a price tag of £16billion. Becoming part of an ever-larger debt-fuelled empire will be disastrous for Royal Mail.
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