December saw continued equity market progress with rising Covid-19 case numbers not sufficient to offset the enthusiasm resulting from a Brexit deal and from vaccine optimism heading into 2021. The Trust outperformed in December to end a very successful year for performance.

Our best performing positions included Delivery Hero, Aixtron and Embracer. Delivery Hero, as well as being deemed a beneficiary of the ongoing Covid-19 restrictions, rallied strongly after announcing that their deal to acquire Woowa brothers in South Korea had received anti-trust approval. Aixtron has continued to benefit from strong semiconductor market fundamentals as well as progress with a significant technological trial with a large South Korean customer. Embracer has traded well and is progressing on its M&A ambitions.

Our worst performing positions included Unicredit, Telecom Italia and Cellnex. Unicredit suffered from the resignation of their well-respected CEO Jean Pierre Mustier and ensuing concerns about future capital allocation priorities. Telecom Italia sold off, alongside it’s sector, on very little news flow whilst Cellnex ended a very successful year with some profit taking.

We made limited trades in December and those that we did were opportunistic in nature. First, we sold our position in Anima, a position where we were hopeful of M&A as a second derivative impact of Italian banking consolidation; we are now less positive on any potential outcome here. We have also added to our position in Dialog. Finally, we added a position in KPN where persistent media reports suggest a strong likelihood of M&A.

We are confident in our positioning and will continue to retain balance in our exposures by considering two types of business for investment; those where we see high and sustainable returns that are undervalued by the market and those companies where we can see a material improvement in medium term business prospects.


Mergers and acquisitions (M&A): the consolidation of companies or assets through various types of financial transactions, including mergers, acquisitions, consolidations, tender offers, purchase of assets, and management acquisitions.