LONDON - Caledonia Investments PLC (LSE:CLDN), a British investment trust, is currently trading at a significant discount to its net asset value (NAV), according to a recent update. Despite a narrowing of the share price discount to NAV during the six-month period ending September 30, 2024, subsequent market volatility has widened the gap, leaving the company with a 37.9% discount.
The board of Caledonia Investments contends that the share price does not reflect the true value of its portfolio and its historical performance. As part of its strategy to address this issue, the company is proposing the continued use of NAV-accretive share buybacks, subject to shareholder approval. This approach is supported by consultations with large independent shareholders.
The company's interim results, released on November 26, 2024, initially showed a favorable reduction in the NAV discount. However, the discount has since increased again due to market reactions to the UK budget and the US election.
Caledonia Investments is encouraging its shareholders to approve the measures that would allow for further share buybacks, which are seen as a method to enhance shareholder value and reduce the NAV discount. This initiative is part of a broader effort by the company's board and management to correct the market valuation discrepancy.
This information is based on a press release statement distributed by Reach, a non-regulatory press release service of RNS, part of the London Stock Exchange (LON:LSEG).
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