ScotGems

LN: SGEM

£46.3m market cap

86.5p last close

ScotGems is a new closed-ended investment company that aims to provide shareholders with long-term capital growth by investing in a focused yet diversified portfolio of c 20-30 small-capitalisation companies listed on global stock markets across a range of sectors. It is expected that, at least initially, the portfolio will be weighted towards small-cap companies (those with a market cap below $2.5bn at the time of investment) in the Asia-Pacific ex-Japan and global emerging markets universes. Investments will not be selected with reference to any benchmark, nor will the portfolio be managed by reference to any index or peer group performance. The managers will build the portfolio gradually over the next six to 12 months as attractive opportunities become available, and as such may hold a relatively high level of cash in this initial period. It has been proposed that cash balances be split equally between pound sterling, US dollar and Singapore dollar, with the option to be held in short-term money market instruments to avoid capital loss from negative interest rates and limit excessive exposure to sterling.

Investment summary

ScotGems (SGEM) has commenced dealing on the London Stock Exchange today, having raised £50.3m via an initial placing and offer for subscription. A new global smaller companies investment trust, managed by Ashish Swarup and Tom Allen at Stewart Investors, SGEM will seek capital growth from a concentrated portfolio of 20-30 stocks with market capitalisations below $2.5bn, initially at least with a bias towards Asia-Pacific and emerging markets. Stewart Investors focuses on stewardship and seeks to invest in small-cap companies with strong franchises and balance sheets. The investment manager is known for closely managing capacity in its investment strategies, with many of its popular funds closed to new investment. A placing programme will allow SGEM to issue up to a further 49.7m shares at a premium to NAV, giving maximum total assets of c £100m at the IPO price.

Share price graph
Price performance
%
1m
3m
12m
Actual 0.6 (5.5) (1.7)
Relative* (0.6) (5.9) 1.0
52-week high/low 96.0p/82.0p
*% relative to local index

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