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Venerable trusts Scottish Investment and JPMorgan Global to merge

Wed, 20th Oct 2021 11:21

(Alliance News) - Scottish Investment Trust PLC will be folded into JPMorgan Global Growth & Income PLC after the two 134-year-old companies agreed a merger.

Under the combination deal announced on Wednesday, the assets of Scottish Investment Trust will be transferred into JGGI, creating an investment company with net assets in excess of GBP1.2 billion. The enlarged JGGI will be big enough to enter the FTSE 250 index of London mid-cap stocks, said Chair Nigel Wightman.

The two companies both were founded in 1887. Combining them is expected produce economies of scale, a higher profile and improved share liquidity.

JGGI will continue to be managed by JPMorgan Funds Ltd and will keep its existing investment strategy and dividend policy. That strategy is a high-conviction portfolio of about 50 to 90 stocks, selected using a bottom-up approach.

Wightman is stepping down as JGGI chair at the company's annual general meeting on Wednesday next week, succeeded by Tristan Hillgarth.

"The transaction brings together two of the oldest investment trusts in the sector, both incorporated in 1887, and creates a vehicle that can continue to serve shareholders' interests for many years to come," Wightman said.

Explaining the decision to merge with JGGI, Scottish Investment Trust Chair James Will said: "The board undertook a lengthy and robust review process and considered a wide range of options for the company. Ultimately, the proposal to combine The Scottish Investment Trust with JPMorgan Global Growth & Income was considered the most compelling outcome for shareholders."

He added: "JGGI offers a style-agnostic total return approach that has delivered index-beating performance, and it distributes an attractive level of dividend to investors."

The investment management change is expected to occur by mid-January, with the merger completed in the first quarter.

Scottish Investment Trust shares were up 7.2% on Wednesday at 807.25 pence. It has a market capitalisation of about GBP500 million. JGGI was down 0.6% at 446.33p. It's market cap is about GBP700 million.

By Tom Waite; thomaslwaite@alliancenews.com

Copyright 2021 Alliance News Limited. All Rights Reserved.

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