Smithson Investment Trust announces £822m fundraise

Smithson Investment Trust plc has become a record-breaker with a £822m fundraise. Terry Smith’s Fundsmith runs Smithson Investment Trust, a new global small- and mid-cap trust.

Terry Smith is the founder of notable British fund manager Fundsmith. Before founding Fundsmith, he was CEO of Tullett Prebon and Collins Steward. CEO stands for Chief Executive Officer. Many people have referred to him as ‘England’s Warren Buffet.’

Smithson’s board had initially aimed for a £250m fundraise. However, the figure soon rose rapidly due to strong investor demand.

Smithson Investment Trust shares

According to Smithson’s board, the firm had received applications under the initial issue for 82,250,956 ordinary shares. The firm said it would issue them at £10 per share.

Smithson’s launch is by far the largest investment trust IPO so far this year. It leaves second place Tritax Eurobox’ £300m a long way behind. It also beat record-breaking Patient Capital trust’s £800m launch three years ago.

IPO stands for Initial Public Offering. It is a stock market launch. In other words, when a company’s shares become available for members of the public to buy.

Smithson Investment Trust record IPO
Smithson Investment Trust focuses on global companies with a market cap of between £0.5bn and £15bn.

Mark Pacitti, Chairman of Smithson Investment Trust plc, said:

“I am delighted that the supplementary prospectus we issued will allow a broad range of investors to participate fully in the exciting opportunity presented and the board of Smithson look forward to governing this new investment trust on behalf of all Shareholders.”

Terry Smith commented:

“Our thesis that many of the existing small and mid cap funds in the market are anachronistic by being overly home biased and that there was a gap for a quality small and mid cap global equity fund appears to have been borne out by a wide range of investors subscribing for the Smithson offer.”

“In addition, our innovative step to absorb all the issue costs as the investment manager has helped to remove the concern that investors participating in the IPO would be subject to an initial loss from these costs. I look forward to working with our portfolio management team to deploy the funds raised into the compelling growth companies we have identified.”