Saba Capital activist investor Boaz Weinstein sees 'storm brewing' in UK investment trusts — and has pounced on these two names

At Sohn London, Boaz Weinstein, founder of $6bn Saba Capital, disclosed new stakes in U.K. investment trusts Workspace Group (a London office REIT) and Pantheon Investments (a private equity fund-of-funds), arguing both trade at significant discounts to NAV. He said U.K. investment-trust discounts have widened to about £19.5bn, with Workspace at roughly a 47% discount to Saba’s fair value and Pantheon at about a 30% long-standing discount, and noted Saba has shifted its portfolio from 95% U.S. to ~60% U.K. Weinstein outlined paths to unlock value—buybacks, tenders, liquidations or take-privates—and estimated narrowing a 35% discount to 20% could yield ~23–24% returns, characterizing the sector as offering equity-like upside for arbitrage-like risk across dozens of closed-end funds.

Analysis

At Sohn London, Boaz Weinstein of Saba Capital disclosed new stakes in two U.K. closed‑end investment trusts: Workspace Group, a London office REIT, and Pantheon Investments, a private equity fund‑of‑funds. Saba, a $6 billion hedge fund known for credit relative‑value trading, has shifted its portfolio mix from 95% U.S. to about 60% U.K., signalling a deliberate reallocation into discount‑rich trusts.

Weinstein quantified a £19.5 billion aggregate widening of U.K. investment‑trust discounts and identified Workspace trading at roughly a 47% discount to Saba’s fair value and Pantheon at about a 30% persistent discount. He laid out three primary value‑unlock paths—buybacks, capital returns (tenders/liquidations) and take‑privates—and estimated compressing a 35% discount to 20% could generate approximately 23–24% returns, framing the trades as equity‑like upside for arbitrage‑like risk.

The approach is activist‑leaning but not necessarily formal campaigns, so near‑term catalysts will depend on management willingness to return capital or sell assets; execution and governance therefore drive realization of the thesis. Key risks noted are persistent discount dynamics, sector specifics (notably London office fundamentals for Workspace) and timing/liquidity of asset sales; sentiment signals flag a moderately positive tone with low‑moderate market impact.

Key Decisions for Investors

• Consider initiating modest, size‑limited positions in deeply discounted U.K. investment trusts such as Workspace and Pantheon to capture potential 23–24% upside if discounts compress, while capping exposure because realization depends on management action and execution risk
• Monitor for concrete catalysts—announcements of buybacks, tenders, asset sales, distribution redeployments or take‑private interest—and set alerts on discount levels and management communications as triggers to add or trim positions
• For Workspace, explicitly limit concentration given REIT and London office exposure; prefer staggered entries or position trimming following any announced asset sale or buyback given its ~47% discount to Saba’s fair value
• For Pantheon, consider a longer‑dated tactical stake to benefit from a persistent ~30% discount that could be closed via fund sales or distribution-driven buybacks, but expect illiquidity and timing uncertainty so size positions accordingly