Investment trust Polar Capital Global Financials Trust (PCFT) is offering shareholders an easy exit at a premium to the current share price, cutting fees and boosting its commitment to future dividends in sweeping changes.

The investment trust has launched a tender offer of its issued share capital (excluding treasury shares), providing investors with an opportunity to fully exit at a price close to NAV (net asset value). The proposal, which follows through on a commitment in the trust’s articles of association, is conditional on shareholder approval and meeting continuation thresholds aimed at ensuring ongoing viability.

The tender offer, managed by Stifel, will allow all qualifying shareholders to tender some or all of their holdings at a price equal to NAV minus costs (capped at 1%). This would have worked out at 211.74p per share, based on NAV of 213.88p on 15 May, a 2.3% premium to the mid-market price of 207p at that time.

To minimise disruption, the board will also conduct a secondary placing of tendered shares to institutional investors at a premium to the tender price, although not more than 3% above or below the prevailing NAV. Any shares not placed will be repurchased by the trust and held in treasury for potential reissue should the shares trade at a NAV premium in the future.

The offer is conditional on no more than 67% of shares being tendered, implying a minimum post-tender NAV of around £200 million, according to calculations by Quoted Data analysts, and that at least 10% of the trust’s shares remaining in public hands. If these conditions are not met, the trust could consider winding itself up.

A general meeting will be held on 18 June 2025 to seek approval for the tender and the related secondary placing. If passed, the tender price will be announced on 20 June, with proceeds expected to be distributed by 1 July.

‘This is a comprehensive and shareholder-friendly set of proposals,’ said Quoted Data’s senior analyst Matthew Read.

‘The tender offer gives investors optional liquidity at close to NAV, while those who remain will benefit from lower ongoing fees and a clear commitment to dividend growth. The enhanced buyback policy should also help reduce discount volatility over time.

The proposals appear aimed at those investors who believe the trust has underperformed in recent years. It’s five-year total return of 152.5% has lagged major UK bank stocks like Lloyds (LLOY), NatWest (NWG) and Barclays (BARC), although it is probably unfair to compare the share price performance of a fund with a portfolio of 126 stocks with the performance of individual stocks.

The trust has outperformed its’ Investment Trusts Financials & Financial Innovation benchmark (55.9%) considerably since 2020. 

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