Electra Investment Trust, the £700m fund that specialises in venture capital, is coming under pressure from Deutsche Asset Management, which has amassed a 12.4 per cent stake in the group and may control even more.
The holding has been built up by traders in Deutsche's New York office, led by Lars Bader, an aggressive operator nicknamed "Darth Vader". Deutsche is understood to have bought options on up to 5 per cent more of Electra and is believed to be in talks with Société Générale, which holds 3 per cent of the trust.
Mr Bader has not made his intentions clear, but it is believed he may be pushing for a liquidation of the trust, which at its last valuation had nearly £700m of assets but is valued by the stock market at half that. It was one of the first funds dedicated to investing in management buyouts. In the early 1990s it was a leading force in the private equity industry, but its position has been eclipsed by the likes of CVC, Permira and BC Partners.
In the past few years the trust has sold more investments that it has bought, and it has been hit by a decline in values in some of its holdings. This has led its net asset value to fall from over £1.4bn to under £700m.
But Electra's portfolio still includes some attractive investments. These include Baxi, the boiler maker, Vendcrown, owner of fast-growing finance firm Premium Credit, and Amtico, the floor coverings group. It is understood that Electra has been waiting for markets to improve so it can sell some of these investments, either through a trade sale or flotation.
The trust has a distinguished board of directors chaired by Sir Brian William- son, who raised the fortunes of futures exchange Liffe before selling it to Euronext. Other directors include Lord King, the former British Airways chairman, and Professor Sir George Bain, who led the recent fire service review of pay and conditions.Reuse content