Baillie Gifford US Growth Trust plcFigures

In a family holding, the counterweight lies in the capital: a reference shareholder decides, and minority holders either put up with it or negotiate. Here there is no controlling shareholder, no executive officer and no employee. The counterweight is a mandate. A wholly non-executive board, independent of the manager, employs it and can dismiss it, and it conducts a formal review of the management arrangements at least once a year. The contract is terminable on not less than six months' notice, which gives the concrete measure of the board's power: six months of fees, of the order of three million pounds at 2026 asset levels, against a portfolio of more than a billion.

The management fee scale is tapered: 0.70% on the first one hundred million pounds of net assets, 0.55% on the next nine hundred million, 0.50% above one billion, calculated and paid quarterly. Ongoing charges are 0.72% for the year ended 31 May 2025, against 0.70% the previous year, for GBP 4,264k actually paid. There is no performance fee, and the board gives its reason: calculating remuneration by reference to performance would be unlikely to exert a positive influence on that performance. Board pay is modest by comparison, with a base fee of GBP 32,564 per director for the 2026 financial year and a statutory cap of GBP 300,000.

The heaviest governance fact in this file appears on no monthly factsheet. At 31 May 2025, Saba Capital Management, an activist manager specialising in discounted closed-ended funds, indirectly held 29.9% of the capital. The chronology, as the board itself writes it: Saba requisitioned a general meeting, which was held on 3 February 2025; at the 2025 annual general meeting six resolutions drew a significant vote against, which the board attributes principally to Saba, which declined to explain itself; the board negotiated a combination with another trust, Saba blocked it, and no further work has been done since to bring it about; and finally, noting the support of the other shareholders, the board took no action following those votes. For a minority shareholder that means one thing: a holder of 29.9% who refuses to engage can block any extraordinary resolution without ever sitting on the board. The board has only two levers, buying back shares, which mechanically buys back Saba's while concentrating its relative share on a shrinking capital, and engaging the rest of the register, which it says is mostly made up of private individuals. One freshness caveat applies: those stakes are as at 31 May 2025, the only shareholder reporting date in the documents held, and at least 5,305,000 shares have been bought back since.

Buybacks are indeed the only lever on the gap between share price and net asset value, since the fund pays no dividend; the annual meeting authorises them each year up to 14.99% of the issued capital. Sixteen million shares were bought back for GBP 35,504k in the year ended 31 May 2025, and 4,505,000 for GBP 11.9m in the half-year ended 30 November 2025, with no new share issued. The series of the gap to net asset value is not monotone, and that is precisely the information: a discount of 11.2% at 31 May 2024, 9.4% at 31 May 2025, 6.3% at 30 November 2025, then a premium of 3.7% at 31 May 2026, and again a discount of 9.2% at 30 June 2026. All those gaps are published by the company and none is recalculated here. The board says it weighs its buybacks with particular reference to the level of exposure to private companies, since buying back shares mechanically concentrates the illiquid pocket on a smaller net asset base. The board finally has five directors, all non-executive and all declared independent of the manager; all sit on both the audit and nomination committees, which is a declared departure from the UK governance code, justified by the board's small size. Three of them have sat since the flotation of March 2018, and a succession is under way with the appointment of Liz Flockhart.