Herald Investment Trust (LSE:HRI) shareholders have rejected proposals from US hedge fund Saba Capital to replace the independent board of directors, with an 80% voter turnout.
It is the first of seven such meetings requisitioned by Saba against London-listed investment trusts.
Out of the total Herald votes, 65.10% were against the resolutions in Saba's requisition, or 26.4 million, with Saba using its 14.1 million votes to vote in favour, representing roughly 34.75%.
Apart from Saba's own votes, there was only support from those holding a further 59,221 shares, representing just 0.15% of the votes.
Andrew Joy, chairman of the independent board, said: "Today non-Saba shareholders have almost unanimously rejected Saba's self-interested proposals."
With almost all votes by non-Saba shareholders against the resolutions, he said it "provides a clear, complete and incontrovertible rebuttal of Saba's attempt to take control of your company and change its strategy against the wishes and interests of its non-Saba shareholders".
He argued that Saba's proposals were rejected as their intended outcome was for Saba to end up managing Herald.
"The reason shareholders invested, and continue to invest, in Herald is for long-term capital appreciation through investing in smaller technology companies, and they do not wish to be deprived of the opportunity to enjoy more of the same. They did not invest in Herald to become part of a short-term trading strategy."
Joy said he regretted that the vote has cost shareholders money, which cannot be reclaimed from Saba, but added: "We look forward to engaging with our shareholders, including Saba, now that our shareholders have voted resoundingly in favour of the board and by extension, the mandate and the manager."
Victory for Herald but more votes coming
Richard Stone, chief executive of the Association of Investment Companies (AIC), hailed the large turnout of investors and said it was "a victory for shareholder democracy".
With six other trusts with votes just around the corner, the boss of the investment company body said, "It’s vital that all shareholders vote on the future of their investment trust. Shareholders need to act now.”
The next meeting that Saba has requisitioned are for Baillie Gifford US Growth and Keystone Positive Change, both on 3 February, with shareholders on investment platforms such as Hargreaves Lansdown, Interactive Investor and AJ Bell set a deadline to vote of 29 January.
On 4 February is the meeting for CQS Natural Resources Growth & Income, with the platform voting deadline being 30 January.
On the same day is the meeting for Henderson Opportunities Trust, with a deadline of 29 January for investors on the HL platform and a day later for the others.
The European Smaller Companies Trust meeting is on 5 February, HL investors must vote by 30 January, AJB and ii investors by 31 January.
Edinburgh Worldwide's date is on 14 February, with deadlines to be confirmed.
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