Saba proposes enhanced exit options for EWI shareholders

Saba Capital Management announced an enhanced liquidity proposal for Edinburgh Worldwide Investment Trust (LSE: EWI) shareholders, offering three exit options if its board nominees are elected at the upcoming annual general meeting.

The proposal from Saba, EWI's largest shareholder, would allow investors to tender immediately at net asset value less costs, tender following a potential SpaceX IPO or liquidity event, or retain their investment in the company. This contrasts with the current board's tender offer proposal, which would provide tendering shareholders with untradeable tracker shares linked to the SpaceX position.

Saba is urging shareholders to vote against the current board's tender offer ahead of the April 8 deadline and support its three independent nominees: Gabriel Gliksberg, Michael Joseph and Jassen Trenkow.

In an open letter to shareholders, Saba highlighted EWI's performance record, stating the trust lost approximately 34% of its value over the past five years despite operating during a bull market. The firm noted EWI underperformed the S&P Global SmallCap Price Index by 55% and the FTSE All-Share Index Total Return by 100% over the same period.

Saba cited its own track record, noting recognition by Institutional Investor as the leading activist hedge fund manager in 2023 and 2024 for closed-end fund discount strategies. The firm's Saba Closed-End Funds ETF returned approximately 81% over the five-year period, according to the announcement.

The proposal aims to address tax efficiency concerns, allowing shareholders carrying embedded gains in EWI to manage potential capital gains tax liabilities on their own timeline rather than being forced to crystallize them under the current board's proposal.

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