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 OR REGULATIONS OF SUCH JURISDICTION

 

This announcement contains information that is inside information for the purposes of Article 7 of the UK version of Regulation (EU) No. 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended (the " Market Abuse Regulation "). The person responsible for arranging for the release of this announcement on behalf of MIGO Opportunities Trust plc is Frostrow Capital LLP acting as corporate secretary.

 

18 June 2025

 

MIGO Opportunities Trust plc ("MIGO" or the "Company")

 

Change of co-manager and new portfolio approach

 

 

MIGO's board has been notified by Asset Value Investors Limited (" AVI "), its AIFM and investment manager, that Nick Greenwood wishes to step back from his role as MIGO's co-manager after over 20 years' involvement with the Company.

 

The board has agreed with AVI that, effective from 18 June 2025, Charlotte Cuthbertson will be joined in co-managing MIGO by Tom Treanor, Director and Fund Manager at AVI. Charlotte and Tom will continue to be supported by AVI's wider 11-strong research team. Nick remains an AVI employee and will become a consultant to the team.

 

 

More focused and activist approach

 

The board and AVI have concurrently decided to implement a higher conviction approach to managing MIGO, to align with the current opportunities in the investment trust sector. This will see MIGO's portfolio concentrating over time to focus on 10-15 core holdings. MIGO currently has 40 holdings in total. The board and AVI believe that larger stakes in a more targeted investment company portfolio will enable more influential engagement with boards, aiming to accelerate superior returns from the wide discount opportunities in the sector.  

 

 

Performance-driven fee structure and capital return mechanism

 

To align MIGO shareholders' interests with this more targeted approach, the board has agreed a revised fee structure with AVI 1 . This will reduce the management fee to 0.35% per annum on the lower of MIGO's market capitalisation and net asset value (NAV) (currently 0.65% per annum on market capitalisation) and add a performance fee of 15% of NAV total returns in excess of a SONIA 2 + 3% hurdle, subject to a high watermark. Overall fees payable by the Company in any year will be capped at 2.5% per annum of the lower of MIGO's market capitalisation and NAV 3 . The Company estimates that the overall fee payable to AVI in any year will be lower under the new arrangement until NAV total return exceeds approximately 9% per annum 4 .

 

The board is pleased to note that AVI proposed, as part of the revised fee structure, to reinvest 25% of any performance fee paid into MIGO shares. This proposal has been agreed by the board, subject to an aggregate 5% cap on AVI's interest in MIGO shares, and a minimum 3-year hold period for shares acquired under this mechanism.

 

To ensure that MIGO remains nimble and is best able to exploit the relevant opportunity set, the board also expects to introduce a capital return mechanism in the future to limit NAV rising above £150m. To be implemented at the board's discretion to optimise shareholder alignment, this will also potentially provide liquidity for shareholders. The board believes a capital return mechanism, combined with the revised fee structure, will avoid a misaligned incentive for AVI to gather assets rather than focus on delivering shareholder returns.

 

These changes reinforce MIGO's commitment to leading investment company best practice, by proactively aligning the portfolio to the investment opportunity, and strengthening alignment between shareholders, manager and board. Portfolio changes will be implemented over time to avoid sacrificing returns from existing maturing investments, for example where a holding is in run-off. The management team, however, expects that the bulk of these changes will be completed within 12 months, subject to market conditions. The board also reiterates its ongoing commitment to MIGO's existing share buyback approach, dividend policy and 3-yearly realisation opportunity.  

 

 

Richard Davidson, MIGO's Chairman, commented:

"The current market conditions and a more focused portfolio are expected to give MIGO a powerful lever to exploit dislocations more quickly. Fully exploiting the opportunity set requires MIGO to stay nimble, so we propose to cap NAV at £150m, returning excess capital to shareholders. The updated fee structure incentivises performance versus asset-gathering. We expect these changes to strengthen the delivery of higher and sustainable returns.

 

"Under Nick's leadership, MIGO has successfully navigated myriad sector evolutions. While there will be a suitable future moment to formally mark the occasion, and celebrate his 45 years in the industry, the board is incredibly grateful to Nick for over two decades' service to MIGO as he hands over to Charlotte and Tom.

 

"With Charlotte and Tom at the helm, and a more focused and activist approach, we're confident that MIGO will remain at peak fitness to capitalise on the substantial current opportunities in the sector."

 

 

Charlotte Cuthbertson, co-manager of MIGO, said:

"The UK investment companies' market is ripe with inefficiencies, with too many funds, some subscale, in a diverse and complex range of asset classes. Share prices can be impacted by selling from non-fundamental sellers and corporate events can have substantial share price impacts, which are often slow to be fully priced in.

 

"Exploiting inefficiencies takes expertise, detailed research and engagement, particularly for the lower-profile, smaller investment companies which often provide the best investment opportunities but require a more concentrated approach.   I'm excited to be working with Tom to deliver this updated approach to MIGO."

 

 

Tom Treanor, co-manager of MIGO and AVI Head of Research, said:

"Delivering returns in these conditions, with double digit discounts prevalent across the sector, takes thorough analysis, a deep understanding of what causes discounts and what steps are needed to remove them. It also takes a degree of impatience to identify and exploit catalysts while they last.

 

"Effective activism involves dealing with boards, managing relationships with other shareholders, knowledge of the legal framework, as well as having a talent pool of directors to call upon when boards need improving. Already specialising in investment companies across AVI, particularly in activist engagement, and knowing MIGO's portfolio well, I look forward to working with Charlotte to put our combined experience and skill sets at the heart of MIGO's investment process."

 

 

Nick Greenwood added:

"Having worked closely with Charlotte for eight years and with Tom for the past two, I know MIGO is in excellent hands as I hand over full portfolio responsibility to them. Charlotte and Tom are well known in the sector, and to many of our investors, as tough but fair champions of shareholder value. As a longstanding MIGO shareholder, I look forward to seeing the returns from their hard work."

 

 

Investor Webinar, video and slides

Charlotte and Tom will host a Zoom webinar for investors at 11am on Monday 23 June to run through the new approach. To access the webinar, please use the following link:   https://us02web.zoom.us/j/88492789088 .

 

The webinar audio can also be accessed by dialling +44 (0)330 088 5830 and webinar ID: 884 9278 9088.

 

A further explanatory video from the team is on the MIGO website, www.MIGOplc.co.uk .   Presentation slides outlining the changes are also available via the same link.

 

 

ENDS

 

For further information, please contact:

 

        MIGO Opportunities Trust plc
        Richard Davidson, Chairman           Via KL Communications or Deutsche Numis

Deutsche Numis - Corporate Broker

Nathan Brown                         +44 (0)20 7547 0569

Matt Goss                            +44 (0)20 7547 0541

KL Communications-Financial PR       MIGO@kl-communications.comCharles GormanAdam Westall                         +44 (0)20 3882 6644 / +44 (0)7795 977 967

Amy Levingston SmithFrostrow Capital - Company Secretary

Richard Plaskett                     +44 (0)20 3709 2407

Kerstin Rucht                        +44 (0)20 3709 8732

 

 

Notes to Editors

 

About MIGO

MIGO's updated objective is to outperform SONIA 2   plus 3% (the "Benchmark") over the longer term, principally through exploiting inefficiencies in the pricing of closed-end funds. This objective is intended to reflect the Company's aim of providing a better return to shareholders over the longer term than they would get by placing money on deposit. The Benchmark is a target only and should not be treated as a guarantee of the performance of the Company or its portfolio.

 

MIGO was launched on 6 April 2004, with Nick Greenwood as its lead investment manager. MIGO's net asset value is currently £82m. Since December 2023, MIGO has been managed by AVI. Further information on MIGO can be found at:   https://www.migoplc.co.uk/

 

About Asset Value Investors (AVI)

AVI is an investment management company established in London, United Kingdom, in 1985. AVI manages AVI Global Trust (£1.3bn), and AVI Japan Opportunity Trust (£267m), both public companies whose shares are listed and traded on the main market of the London Stock Exchange.

Website:   https://www.assetvalueinvestors.com/

LinkedIn:   https://www.linkedin.com/company/asset-value-investors-limited/about/

 

 

Biographies

 

Charlotte Cuthbertson joined AVI in July 2023 as a Fund Manager and has been co-manager of MIGO Opportunities Trust since it transitioned to AVI in late 2023. Charlotte has 10 years' experience in the finance industry, with the last 7 years specialising in investment trusts.   Prior to AVI she worked at Tyndall Investment Management and Premier Miton plc, where she assisted Nick Greenwood in managing MIGO.   Charlotte holds a BA in Modern History from St Anne's College, Oxford.

 

Tom Treanor joined AVI in February 2011 and was appointed to the board of Asset Value Investors in September 2017. He is a Portfolio Manager and Head of Research, working closely with the analyst team providing support and guidance on prospective and current investments across the portfolio. Tom has specialised in closed-end funds over the past 20 years, particularly in activist engagement. He spent nine years working for Fundamental Data/Morningstar in various roles involving closed-end fund analysis. He has a degree in Economics from the University of Leicester and is a CFA charterholder.

 

Nick Greenwood joined Asset Value Investors from Premier Miton in December 2023. He began his career in private client stockbroking and was a founder member of Christows' stockbroking operation in 1991. He joined Christows' Investment Trust team, setting up their London office in 1995 and became lead manager in November 1997. Nick subsequently joined Premier Miton.   Nick has managed MIGO Opportunities Trust since its Initial Public Offering in April 2004.

 

 

Notes

 

1) Under the UK Listing Rules, AVI is a related party of MIGO and the changes to the investment management agreement constitute a relevant related party transaction under Listing Rule 11.5.4(1). The board of MIGO considers the proposed changes to the investment management agreement to be fair and reasonable as far as the MIGO shareholders are concerned and the MIGO directors have been so advised by Deutsche Numis acting in a sponsor capacity.

 

2) SONIA is the Sterling Overnight Index Average, the Sterling Risk-Free Reference Rate preferred by the Bank of England for use in Sterling derivatives and relevant financial contracts.

 

3) Any performance fees earned that exceed the 2.5% annual cap will be carried forward for up to three years. During that period, AVI would only receive the deferred amount if a performance fee is earned in a subsequent year and subject to the total fee for that year remaining below the cap.

 

4) Based on SONIA at current levels.

 

5) Numis Securities Limited ("Deutsche Numis"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for MIGO and no one else in connection with the matters referred to in this announcement. In connection with such matters, Deutsche Numis will not regard any other person as its client, nor will it be responsible to any person other than MIGO for providing the protections afforded to clients of Deutsche Numis or for providing advice in relation to the contents of this announcement or any other matter referred to herein. Neither Deutsche Numis nor any of its affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct, indirect, consequential, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Deutsche Numis in connection with the matters referred to in this announcement, any statement contained herein or otherwise.

 

This document does not constitute an offer to sell or a solicitation of an offer to buy or subscribe for any securities and neither is it intended to be an investment advertisement or sales instrument of   AVI. The distribution of this document may be restricted by law in certain jurisdictions. Persons into whose possession this document comes must inform themselves about and observe any such restrictions on the distribution of this document. In particular, this document and the information contained therein is not for distribution or publication, neither directly nor indirectly, in or into the United States of America, Canada, Australia or Japan.