Rebel investor seeks 'beauty parade' at Alliance Trust

It is widely expected that shareholders will vote to support the board of Dundee-based Alliance Trust, which is fighting against a proposal from Laxey calling for it to introduce a formal buy-back policy in a bid to stop a long-term fall in share value.

But the Isle of Man-based hedge fund said it expected there would be a sufficient number voting against the trust that would pave the way for it to call for a "beauty parade" of managers that could replace chief executive Katherine Garrett-Cox.

Although the firm only has a 1.7 per cent share of the 2.3 billion trust, Laxey believes it could rally the support of other investors to call an extraordinary general meeting.

A spokesman for Laxey said: "In the event Laxey finds shareholders are dissatisfied by the outcome of this week's meeting, it may call an egm that would focus on holding a beauty parade and moving towards an external management contract."

A source said the result could lead to the removal of Cox or see pressure put on chairman Lesley Knox to resign. It is thought Knox has led the board's reluctance to consider a discount control mechanism along the lines proposed by Laxey. The source added: "It could have been avoided if Alliance Trust hadn't been so dogmatic. They only have themselves to blame. It could be the whole thing starts to unravel. It is a question of who carries the can for it."