RCS - Saba Capital Mgmt. - SABA STANDSTILL AGREEMENT – ESCT

European Smaller Companies TrustAnnouncement

15/04/2025 08:15

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RNS Number : 0116F  Saba Capital Management L.P  15 April 2025

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SABA STANDSTILL AGREEMENT - ESCT

 

 

 

Saba Capital Reaches Agreement with The European Smaller Companies Trust PLC

 

Saba Capital Management, L.P. (together with certain of its affiliates, "Saba"
or "we") today announced that it has entered into a standstill agreement (the
"Agreement") with The European Smaller Companies Trust PLC (ESCT:LSE) ("ESCT"
or the "Trust") following constructive negotiations with the Board aimed at
achieving an outcome that benefits all shareholders.

 

Under the terms of the Agreement and subject to shareholder approval, the
Trust will conduct a tender offer for up to 42.5% of the ordinary shares in
issue. This provides shareholders who wish to exit their investment in ESCT an
opportunity to do so. The tender offer will be available to eligible
shareholders on the register of members of ESCT as at 6:00 p.m. BST on 16
April 2025 and will include a cash exit option and an in specie consideration
option.

 

In accordance with the terms of the Agreement, Saba has committed to tender
115,386,122 of its ordinary shares of the Trust, in addition to complying with
certain standstill covenants for a period that ends with the conclusion of the
Trust's annual general meeting to be held in 2028, or earlier pursuant to the
terms of the Agreement.

 

For information regarding the tender offer and the general meeting which is
being convened by the Trust to consider the tender offer, shareholders of the
Trust should refer to the circular which has been published by the Trust
today.

 

Boaz Weinstein, Founder and Chief Investment Officer of Saba, commented:

 

"We are pleased to have reached a constructive agreement with ESCT's Board
that puts shareholders first. From the outset, our objective has been clear:
to unlock value for shareholders across the U.K. investment trust sector.
Today's agreement marks a significant step in that direction, providing those
ESCT shareholders that wish to exit their investment with the opportunity to
do so through a substantial tender offer.

 

ESCT now becomes the fifth trust, of those we requisitioned general meetings
at, that has taken decisive, shareholder-friendly action following our
engagement. This milestone underscores the positive and transformative impact
we have had on the sector. We remain committed to advancing outcomes that
enhance liquidity, improve governance and deliver long-term value for all
shareholders."

 

White & Case LLP is acting as legal adviser to Saba Capital Management,
L.P.

 

About Saba

 

Saba Capital Management, L.P. is a global alternative asset management firm
that seeks to deliver superior risk-adjusted returns for a diverse group of
clients. Founded in 2009 by Boaz Weinstein, Saba is a pioneer of credit
relative value strategies and capital structure arbitrage. Saba has offices in
New York City and London. Learn more at www.sabacapital.com
(http://www.sabacapital.com) .

 

Media Contact

Longacre Square Partners

Kate Sylvester, +1-646-386-0091
ksylvester@longacresquare.com (mailto:ksylvester@longacresquare.com)

 

Disclaimer

 

This announcement is not intended to be and does not constitute or contain any
investment recommendation as defined by Regulation (EU) No 596/2014 (as it
forms part of the domestic law in the United Kingdom by virtue of the European
Union (Withdrawal) Act 2018). No information in this announcement should be
construed as recommending or suggesting an investment strategy. Nothing in
this announcement or in any related materials is a statement of or indicates
or implies any specific or probable value outcome in any particular
circumstance. This announcement is provided merely for general informational
purposes and is not intended to be, nor should it be construed as (1)
investment, financial, tax or legal advice, or (2) a recommendation to buy,
sell or hold any security or other investment, or to pursue any investment
style or strategy. Neither the information nor any opinion contained in this
announcement constitutes an inducement or offer to purchase or sell or a
solicitation of an offer to purchase or sell any securities or other
investments in the Trust or any other trust by Saba or any of its affiliates
in any jurisdiction. This announcement does not consider the investment
objective, financial situation, suitability or the particular need or
circumstances of any specific individual who may access or review this
announcement and may not be taken as advice on the merits of any investment
decision. This announcement is not intended to provide the sole basis for
evaluation of, and does not purport to contain all information that may be
required with respect to, any potential investment in the Trust. Any person
who is in any doubt about the matters to which this announcement relates
should consult an authorised financial adviser or other person authorised
under the UK Financial Services and Markets Act 2000. To the best of Saba's
ability and belief, all information contained herein is accurate and reliable,
and has been obtained from public sources that Saba believes to be accurate
and reliable. However, such information is presented "as is", without warranty
of any kind, whether express or implied, and Saba has not independently
verified the data contained therein. All expressions of opinion are subject to
change without notice, and Saba does not undertake to update or supplement any
of the information, analysis and opinion contained herein.

 

Subject to the terms of the Agreement, Saba may continue transacting in the
shares and securities of the Trust and any other trust, and/or derivatives
referenced to them (which may include those providing long and short economic
exposure) for an indefinite period following the date of this announcement and
may increase or decrease its interests in such shares, securities and/or
derivatives at any time.

 

Forward-Looking Statements

 

This announcement contains certain forward-looking statements and information
that are based on Saba's beliefs, as well as assumptions made by, and
information currently available to, Saba. These statements include, but are
not limited to, statements about strategies, plans, objectives, expectations,
intentions, expenditures and assumptions and other statements that are not
historical facts. When used herein, words such as "anticipate," "believe,"
"estimate," "expect," "intend," "plan" and "project" and similar expressions
(or their negative) are intended to identify forward-looking statements. These
statements reflect Saba's current views with respect to future events, are not
guarantees of future performance and involve risks and uncertainties that are
difficult to predict. Further, certain forward-looking statements are based
upon assumptions as to future events that may not prove to be accurate. Actual
results, performance or achievements may vary materially and adversely from
those described herein. There is no assurance or guarantee with respect to the
prices at which any securities of the Trust or any other trust will trade, and
such securities may not trade at prices that may be implied herein. Any
estimates, projections or potential impact of the opportunities identified by
Saba herein are based on assumptions that Saba believes to be reasonable as of
the date hereof, but there can be no assurance or guarantee that actual
results or performance will not differ, and such differences may be material
and adverse. No representation or warranty, express or implied, is given by
Saba or any of its officers, employees or agents as to the achievement or
reasonableness of, and no reliance should be placed on, any projections,
estimates, forecasts, targets, prospects or returns contained herein. Neither
Saba nor any of its directors, officers, employees, advisers or
representatives shall have any liability whatsoever (for negligence or
misrepresentation or in tort or under contract or otherwise) for any loss
howsoever arising from any use of information presented in this announcement
or otherwise arising in connection with this announcement. Any historical
financial information, projections, estimates, forecasts, targets, prospects
or returns contained herein are not necessarily a reliable indicator of future
performance. Nothing in this announcement should be relied upon as a promise
or representation as to the future. Nothing in this announcement should be
considered as a profit forecast.

 

Permitted Recipients

 

In relation to the United Kingdom, this announcement is being issued only to,
and is directed only at, (i) investment professionals specified in Article
19(5) of the Financial Services and Markets Act 2000 (Financial Promotion)
Order 2005 as amended (the "Order"), (ii) high net worth entities, and other
persons to whom it may lawfully be communicated, falling within Article
49(2)(a) to (d) of the Order and (iii) persons to whom an invitation or
inducement to engage in investment activity (within the meaning of section 21
of the Financial Services and Markets Act 2000) in connection with the issue
or sale of any securities of the Trust or any member of their respective
groups may otherwise lawfully be communicated or caused to be communicated
(all such persons together being referred to as "Permitted Recipients").
Persons who are not Permitted Recipients must not act or rely on the
information contained in this announcement.

 

Distribution

 

Not for release, publication or distribution, in whole or in part, directly or
indirectly, in, into or from any jurisdiction where to do so would constitute
a violation of the relevant laws of that jurisdiction. The distribution of
this announcement in certain countries may be restricted by law and persons
who access it are required to inform themselves and to comply with any such
restrictions. Saba disclaims all responsibility where persons access this
announcement in breach of any law or regulation in the country of which that
person is a citizen or in which that person is residing or is domiciled.

 

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