SVM holding steady over £58.2m bid from Cyrun

EDINBURGH fund manager SVM yesterday repeated its plea to shareholders to "take no action" as it prepared its response to an unsolicited £58.2 million bid for its SVM UK Active Fund.

The bid for the investment trust is being led by Cyrun Finance, which is owned by US investor Stewart Horejsi.

Horejsi claims to be a "close personal friend" of billionaire American investor, Warren Buffet, and holds a 0.15 per cent stake in Buffet's investment firm Berkshire Hathaway.

Cyrun already holds a 25.7 per cent stake in SVM and said the bid price would represent a narrower discount to net asset value than could have been obtained in the market over the last 12 months.

If the bid is successful, SVM shareholders will also be able to retain shares in the trust under the new owners. Cyrun pledged to widen the fund's asset base.

The SVM UK Active Fund was launched in 1994 managing a portfolio of principally UK listed companies, which includes BP.

Steve Miller, chairman of Cyrun, said: "The proposed offer provides SVM shareholders with the choice of selling their SVM shares for cash at a price which represents a narrower discount to net asset value than could have been obtained in the market over the last 12 months or retaining their SVM shares with the potential prospect of SVM's portfolio being managed by an affiliate of Stewart Investment Advisers with a more international asset allocation policy."

Cyrun was formed in September to hold the Stewart West Indies Trust's investment in SVM. Stewart is a family trust domiciled and administered in Anchorage, Alaska.

In its last accounts statement, the boutique asset management company SVM said its goal was to "increase fund under management" after it revealed it had made a 24,000 loss for the year to 31 December 2009. SVM has assets under management of around 600m.