The trust will be run by Richard Plackett and Mike Prentis using a long/short strategy and BlackRock says it will be the first UK-listed investment trust to take that stance.
Prentis, who manages the BlackRock smaller companies trust, will run the portfolio on a long-only basis while Plackett, who heads BlackRock’s smaller companies team, will have the ability to invest 30 per cent in contracts for difference to provide long and short exposure.
There will be an initial offer for 40 per cent of the share capital with a 2 per cent exit charge and ongoing discounts.
The directors placed the trust under review following the departure of manager Roger Whiteoak from Axa Framlington in February. The board had proposals from eight parties. Among those rejected was a merger proposal from Gartmore global opportunities managed by Gervais Williams.
Throgmorton chairman Richard Bernays says: “BlackRock has an excellent record in the smaller companies sector. Using contracts for difference is an innovative approach to managing assets of a UK investment trust and is appealing in maximising returns for shareholders through the market cycle.”
Axa Framlington says it is still fully committed to the small-cap sector.