20th Feb 2026 10:37
(Alliance News) - Blackrock Smaller Cos Trust PLC and Blackrock Throgmorton Trust PLC have agreed to a proposed merger, the companies announced Friday.
Blackrock Throgmorton said this will bring together two similar investment companies with significant portfolio overlap and create a company with net assets of approximately GBP780 million, which will deliver greater scale, liquidity and cost efficiencies and be the largest growth-focused trust in the AIC's UK smaller companies sector.
The AIC is the London-based Association of Investment Companies.
Shareholders are being offered a cash exit opportunity for up to 38% of Blackrock Throgmorton's issued share capital, and up to 28% of Blackrock Smaller's shares.
Blackrock Throgmorton Chair James Will said: "The proposed combination follows a comprehensive review of available options by the board and is focused on driving long-term value for shareholders through greater scale, liquidity and cost efficiencies. Continuing shareholders will benefit from a portfolio of high quality, diversified UK smaller companies, and the continuity of BlackRock's investment philosophy and process that has proven highly successful over the long term."
Blackrock Smaller Chair Ronald Gould said: "The UK smaller companies sector is a diverse and exciting part of the domestic equity market, encompassing a broad range of established businesses with meaningful growth prospects, but which are often under-researched and overlooked by most investors and available at discounted valuations compared to global comparators. With increased scale, lower costs and improved liquidity, the enlarged BRSC will be well positioned to provide shareholders with sustained and enhanced exposure to this compelling growth opportunity over the medium and long term."
Activist investor Saba Capital intends to vote in favour of the proposals: "Saba welcomes today's announcement, which includes several shareholder-friendly initiatives for the combined company such as reduced management fees, lower ongoing charges, an initial cash exit opportunity and a triennial conditional exit opportunity. We appreciate the constructive dialogue we've had with the companies' boards of directors and their advisors and believe the combination proposal is in the best interests of shareholders."
Saba has an interest of 17.8% in the voting share capital of Blackrock Throgmorton, and a 10.4% interest in the voting share capital of Blackrock Smaller.
Blackrock Throgmorton will hold two general meetings regarding the implementation of the proposals, one on March 26 and the second one on April 16. Blackrock Smaller will hold one general meeting on March 30.
The companies expect the merger to become effective on April 16, subject to shareholder approvals at the general meetings prior.
Blackrock Smaller shares were 3.6% higher at 1,424.00 pence each, giving it a market capitalisation of GBP547.0 million, while Blackrock Throgmorton shares were down 0.1% at 656.51p each on Friday morning in London, for a market cap of GBP493.5 million.
By Tom Budszus, Alliance News slot editor
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Related Shares:
BlackRock Smaller Companies Trust PLCThrogmorton Trust