**Summary**
Smithson Investment Trust PLC (SSON) has announced a proposed restructuring plan to roll over its assets into a new open-ended investment company (OEIC) called Smithson Equity Fund (New Smithson). This move aims to address the persistent discount to net asset value (NAV) at which SSON shares have traded since early 2022, despite a significant buyback program. The key details of the proposal include
1. **Investment Continuity**The new OEIC will maintain the same investment strategy and manager (Fundsmith LLP), with Simon Barnard as portfolio manager, focusing on long-term investments in small and mid-sized global companies.
2. **No NAV Dilution**Shareholders rolling over into New Smithson will not face NAV dilution, thanks to a cost contribution from Fundsmith LLP.
3. **Cash Exit Option**Shareholders can opt for a full cash exit at NAV less costs, providing flexibility.
4. **Daily Trading at NAV**New Smithson’s open-ended structure will allow shareholders to buy and sell shares at NAV daily, eliminating the discount issue.
5. **Tax Efficiency**UK shareholders can roll over their investment without triggering capital gains tax.
6. **Fundsmith Contribution**Fundsmith will cover costs such as legal fees, stamp duty, and setup expenses to ensure no NAV dilution for rolling shareholders.
7. **Timetable**The scheme is expected to be completed by March 2026, pending shareholder approval and regulatory authorization.
8. **Shareholder Support**Major shareholders, including Saba Capital Management (16.05% interest) and Terry Smith (2.30% interest), have indicated support for the proposal.
The Board believes this restructuring will restore shareholder value by providing a clear path to eliminate the discount while preserving the proven investment strategy. A circular with further details will be published by January 2026, followed by shareholder votes to approve the scheme.