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Round 2! Bramson makes second bid to join Electra board

Activist investor Edward Bramson calls a second shareholder meeting at Electra Private Equity. With 31% of the shares he's in a strong position.

 
Round 2! Bramson makes second bid to join Electra board

Activist investor Edward Bramson has launched a fresh bid to gain a seat on the board of Electra Private Equity (ELTA ) investment trust.

Through his Sherborne investment vehicle, Bramson (pictured) is calling for the investment trust to hold a second general meeting at which investors can vote on resolutions to install him and Ian Brindle to the investment trust's board.

Although he was defeated in his bid to be elected to the trust's board in a shareholder vote last October, Bramson remains dogged in his aim of shaking up the business.

He raised £100 million back in February to renew his campaign against the trust and last month upped his stake in the company to 31%.

Since that failed vote, Electra said that it has met with Bramson three times and made clear that the board 'remains unanimous in continuing to oppose his and Brindle's appointment'.

In a stock market announcement, Electra said: 'The board of Electra remains convinced that the interests of all shareholders are best served by the combination of a board that is wholly non-executive and independent of any significant shareholder, together with the continuing management of the portfolio by Electra Partners on an exclusive and wholly discretionary basis.'

Although Bramson was defeated in his attempts to gain control of the trust, the review it carried out in the wake of the shareholder vote led to it slashing its management fee from 1.5% to 1% and paying a dividend.

Jefferies analyst Matthew Hose said the ongoing battle was creating uncertainty that weighed on Electra's shares, which trade at 11% below net asset value.

He added that while Sherborne's increased stake in the company strengthens its hand, there remained a lack of clarity around its ultimate intentions. 'We continue to argue the "low-hanging fruit" of improving Electra's capital structure, management fee, and distribution policy have now been plucked and so the likely path of further action by a revised board is much less clear,' Hose said.

'Given the limited opportunity for Sherborne to perform hands-on work on Electra's underlying portfolio companies, our best guess is that its broad intention could be to make proposed changes to the overall management structure of the trust, such as its internalisation.'

Electra shares were up 1.39% or 45p at 3,285p in early morning trading.

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