NextEnergy Solar Fund Ltd (LSE:NESF) saw an overwhelming majority vote in favour of continuing, a move which analysts say they understand despite many renewable funds trading at a 20%+ discount.
At the fund’s annual general meeting, a continuation ballot showed that of the nearly 60% of shareholders that decided to vote only 6% decided it was time to begin wind-up procedures.
Analysts at Stifel noted that many renewable trusts had been trading a significant discounts compared to net asset values, meaning shareholders would have had a chance to crystalise gains by discontinuing.
“We think shareholders have realised that it is probably the wrong point in the cycle for these funds to move towards wind-up and be forced sellers of assets,” said the investment banking firm.
“However, we are surprised that shareholders haven't used these votes more as a means to push for change such as lower management fees or for a formal mechanism to be put in place to return cash to investors in an orderly fashion.”
Stifel maintains a 'neutral' recommendation for NextEnergy.