A major investment house that proposed a £5 billion mega merger with Dundee’s Alliance Trust has failed to mention the short-lived plan in its six monthly review.
London-headquartered RIT Capital made an unsolicited approach for the West Marketgait-based Trust in May, sparking a formal offer period under the Takeovers and Mergers Code.
The combination of the two companies would have created one of the UK’s largest investment trusts with a market value in excess of £5bn.
However the group, headed by veteran British financier Lord Rothschild, walked away from the deal a week later after “careful analysis and constructive discussions” led it to the conclusion that a merger would not be in the best interest of shareholders.
RIT Capital yesterday published its results for the six months to June 30 and hailed a performance that took the company’s net asset value to a new all-time high of £2.6 billion.
However, there was no mention in the report of its bid for Alliance Trust, with Lord Rothschild instead choosing to highlight the uncertain geopolitical situation in relation to Brexit, the upcoming US Presidential elections and the “opaque” Chinese economy.
“The six months under review have seen central bankers continuing what is surely the greatest experiment in monetary policy in the history of the world,” Lord Rothschild said.
“We are therefore in uncharted waters and it is impossible to predict the unintended consequences of very low interest rates, with some 30% of global government debt at negative yields, combined with quantative easing on a massive scale.
“To date, at least in stock market terms, the policy has been successful with markets near their highs, while volatility on the whole has remained low.
“Nearly all classes of investment have been boosted by the rising monetary tide. Meanwhile, growth remains anaemic, with weak demand and deflation in many parts of the developed world.”