The Lindsell Train Investment Trust audit committee has recommended the company hold a tender process to appoint an external auditor.
Pricewaterhousecoopers has filled the role since March 2018 and LTIT was not due to hold a tender process, but one was recommended by the committee “in the interests of obtaining the best value for shareholders”.
Interestingly, the search for a new auditor comes after the publication of the results of LTIT’s annual general meeting, held on 8 September. It saw a resolution to re-appoint PWC as auditor “from the conclusion of [the AGM] until the conclusion of the next general meeting at which financial statements are laid before the company” pass with nearly 99.9% of the vote.
A spokesperson for LTIT declined to comment when contacted by Portfolio Adviser about the U-turn just four days after the motion was overwhelmingly approved.
The process will take place between September and November, with a final decision expected that month. The chosen firm will audit the trust’s financial statements for the year ending 31 March 2023.
Bubbling discontent with directors?
In total, shareholders voted on 15 motions at the AGM: 12 ordinary resolutions and three special business matters.
Eleven were approved by more than 99% of votes. In fact, four received unanimous support: these were to receive the financial statements for the year ended 31 March 2022, approve final and special dividends and authorise share buybacks.
There were five resolutions relating to the re-election of company directors that didn’t fare quite as well. While 334 votes were cast against Michael Lindsell (pictured), he secured nearly 99.4% of the ballots.
But the four other directors, despite also comfortably securing re-election, saw a considerable jump in the number of votes cast against their re-appointments.
Jim Cazalet, Vivien Gould and Richard Hughes all received a similar number of votes against; 1,392, 1,325 and 1,385, respectively. As a percentage, however, they received roughly 97.4% of ballots in their favour.
When it came to Nicholas Allan, however, he received double that number at 2,670—meaning he was re-elected with 95% of the vote. According to the LTIT website, Allan was appointed a director in September 2018 and has been chair of the nomination committee since March 2022, having been a founder of Boyan Allan Investment Management in 1998.
No details were provided about why the directors, particularly Allan, received votes against their re-election. The similar numbers suggest there might be an element of block or tactical voting. But securing such a high proportion of votes in their favour means none was at risk of losing their role, suggesting that any concerns are not widely felt.
It has been a very difficult year for strategies across the board, and the £215m investment trust is no exception, returning -27% over the 12 months to 12 September, while its benchmark—the IT Global—delivered -16.8%. Its NAV is down 13.5% over the same period, according to Trustnet.
See also: Michael Lindsell heralds return of Heineken’s mojo