The declaration last week from US hedge fund manager Boaz Weinstein’s Saba Capital Management that the board of Edinburgh Worldwide Investment Trust are “completely out of touch with their own shareholders” was astounding.

Yes, Saba had a few days earlier succeeded in scuppering the board’s proposal for a tender offer for up to 100% of the issued share capital of the investment trust, which is run from Edinburgh by Baillie Gifford and has Elon Musk’s SpaceX as its largest single holding.

Edinburgh Worldwide Investment Trust (EWIT) announced on April 10 that it had failed to win sufficient backing from shareholders for its proposal for a tender offer - which it put forward on March 10 as it declared it had reached the “end of the road” with Saba’s “obsession”.

The investment trust, which had total assets of £864.71 million at March 31, declared the outcome of this vote was “very disappointing”.

Of the total votes cast, 46.2% of shares were voted in support of the trust's tender offer proposal and 53.8% against. EWIT needed majority support at the April 10 general meeting to proceed with its proposal.

However, what is crucial in assessing this outcome is the relatively simple arithmetic behind the vote.

EWIT chairman Jonathan Simpson-Dent observed in January that Saba had a stake of “just over” 30% in the investment trust.

Shareholders representing 68.4% of the issued share capital voted, including Saba.

So it is plain to see from the 46.2% figure that the great bulk of non-Saba shareholders who voted backed the tender offer proposal of EWIT’s board.

Saba’s “completely out of touch” claim regarding EWIT’s board is therefore surely wide of the mark.

EWIT, which has many individual shareholders, spelled out the reality of the situation on April 10, declaring that the votes against the proposal were “almost entirely by Saba and two other institutions”.

When it comes to Saba’s claim about EWIT’s directors being “out of touch” with shareholders, we should also bear in mind that the US hedge fund has failed in its two previous attempts to oust the investment........

© Herald Scotland