Banking

Acorn Income board recommends liquidation of trust

Last month, the board reversed its decision to appoint BMO Global Asset Management and substantially change the trust’s investment objective and policy.

In its latest update, the board said due to a number of factors including the dual portfolio structure, likely future cut in dividends, historic discount to NAV and size of the company, they “did not believe that the company can viably continue in its existing form”.

The trust’s ordinary shares are currently trading on a discount of 17.93% but news of the board’s proposal has boosted the fund’s share price, which was up 11.2% at the time of publication, according to data from Hargreaves Lansdown.

However, in its latest consultation with shareholders, the board found that some endorsed the portfolio under Unicorn’s management, while others simply wanted to exit.

In the past three years, the Unicorn fund has returned 15.7% ahead of its benchmark the FTSE All Share, which returned 11.4%, according to FE fundinfo.

Unicorn has agreed to waive its management fees and entry charge for the Unicorn UK Income fund for a period of 12 months for those Acorn shareholders choosing to move their investment over.

The proposals remain subject to shareholder and regulatory approvals.

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