Share buyback programme pays off for Mercantile investment trust

The £1.2bn Mercantile Investment trust has seen its discount tighten to below 10% following its recent share buyback programme.

Last year the trust repurchased 2.9% shares, adding 4.1p to the net asset value per share at the end of January, the group’s annual results revealed. This drove the share price up 15.9%, from 23.2p to 26.9p, resulting in the company outperforming its benchmark, the FTSE All Share, by 7.2%. Crucially, it also narrowed the discount from last year’s high of 16.1%.  Martin Hudson, who heads up the trust, says the board has renewed the option of further share buybacks this year. “The board will continue repurchasing up to 14.99% of the company’s shares to manage imbalances between...