Merryn Talks Money Why This Controversial Investment Trust Deal Has Riled Key Shareholders
Nov 21, 2025
Chris Clothier, Co-CIO of Capital Gearing Asset Management, shares his sharp insights on the controversial HICL-TRIG merger, which has left many shareholders furious. He breaks down the different asset portfolios held by both trusts and highlights the risks that led to their discounted trading. Clothier argues that the merger unfairly disadvantages HICL investors while benefiting TRIG shareholders. The discussion also touches on the potential consolidation of the investment trust sector and the broader implications for the market, including concerns over rising taxes and falling London house prices.
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Very Different Asset Profiles
- HICL (core PFI, toll roads, HS1) and TRIG (wind, solar, batteries) invest in materially different asset classes.
- Merging them forces HICL holders into renewables exposure they may not want.
Why Discounts Widened
- Investment trusts act as bond proxies so rising rates cut their NAVs and widen discounts.
- Renewables face extra hits: wind variability, profit levies and retro subsidy risk raising discount rates.
NAV‑for‑NAV Structure Transfers Value
- The merger is NAV-for-NAV despite TRIG trading on a much wider discount than HICL.
- That structure effectively makes HICL shareholders pay up for weaker renewables assets.