(Alliance News) - European Opportunities Trust PLC on Tuesday said its investor Saba Capital Management has asked the company to double its tender offer.

On Monday, European Opportunities Trust announced that it would undertake a tender offer to buy back shares.

The company focused on "high conviction" investment in "differentiated" European companies said it will buy back up to 25% of the issued share capital of the company.

The price will be at the prevailing net asset value at the time of repurchase, adjusted for costs associated with the tender offer, minus 2%. The offer runs until January 31.

European Opportunities Trust said it aims to reduce discount volatility, aiming for a discount in single digits in normal market conditions. Buying back shares can raise the share price.

However, on Tuesday, the company noted Saba Capital Management's publication of a letter regarding its opposition to the proposed tender offer.

"The board believes that the 50% tender offer suggested by Saba would not be in the best interests of the majority of shareholders at this time and affirms its position in recommending that a 25% tender offer be implemented following the company's annual general meeting on 15 November," European Opportunities Trust said.

"The board believes Saba's contention - that the completion of the 25% tender offer would lead to a widening of the discount to NAV 'to at least 15% - a level common in UK investment trusts that do not have a continuation vote' - to be conjecture."

It added that it remains confident in its long term investment strategy.

Shares in European Opportunities Trust closed down 0.6% to 792.00 pence each in London on Tuesday.

By Sophie Rose, Alliance News senior reporter

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