RIT Capital Says No Plan to Make Offer to Buy Alliance Trust

Updated on
  • RIT made informal approach, Alliance Trust said on May 30
  • Alliance Trust reviews business, no plans for share buyback

Jacob Rothschild’s RIT Capital Partners Plc said it doesn’t plan to bid for Alliance Trust Plc following an informal merger approach.

“RIT has concluded that it would not be in the best interests of its shareholders to make an offer,” RIT Capital said in a statement on Tuesday. “The board of RIT respects the process which Alliance Trust are going through and wishes them well with their strategic review.”

Alliance Trust, the British investment firm founded in 1888, said on May 30 that it received an informal merger approach from RIT. Alliance Trust shares fell as much as 2.2 percent in London trading after Tuesday’s announcement and were down 1.3 percent to 510 pence as of 12:08 p.m. in London, valuing the firm at 2.63 billion pounds ($3.8 billion).

Alliance Trust said on Tuesday it is implementing changes to enhance shareholder value and won’t buy back shares until it has completed a review of its business.

“This process is well under way and has already started to make good progress, lowering costs, narrowing the discount and allowing for the creation of a fully independent board of directors,” the Dundee, Scotland-based company said in a statement.

The review, announced in October, follows a boardroom battle last year with activist hedge-fund manager Elliott Advisors, which led to the departure of Katherine Garrett-Cox as chief executive officer. Robert Smith was appointed chairman in February, replacing Karin Forseke, who also stepped down.