Schiehallion: Value of Spacex stake in Baillie Gifford trust skyrockets
Baillie Gifford’s Schiehallion trust marked up the value of its holdings in Elon Musk’s Spacex by 86 per cent last year, as the trust worked to close the gap between its share price and underlying assets.
The valuation of Spacex, which makes up 9.4 per cent of Schiehallion’s portfolio, has increased by more than 600 per cent since the trust first invested in it in 2019.
Schiehallion has holdings in half of the world’s ten largest private companies: Spacex (the largest private company in the world), Tiktok owner Bytedance, Stripe, Databricks and Chime.
In the trust’s annual results, it revealed that its share price increased 51 per cent in the year to 31 January, while its underlying asset value grew 12.9 per cent, narrowing its share price discount to underlying assets from 39.6 per cent to 19.2 per cent.
However, since the trust’s launch in 2019, its share price has increased only eight per cent, despite underlying assets increasing in value by more than 34 per cent.
Spacex and Baillie Gifford
Reports emerged in November that a tender offer had valued Spacex at $250bn (£200bn) for outside investors, spiking investor interest in the private company.
Analysts calculated that Baillie Gifford’s trusts had upped the valuation of its Spacex holdings by between 40-45 per cent as a result of the tender offer alone and had sold back some of their shares in the process.
“During the final quarter of 2024 we also trimmed our position in SpaceX for portfolio management reasons, but we retain strong conviction in the company’s upside potential from here,” said the trust today.
In total, Schiehallion sold $5.4m of shares in the company over the last year, while retaining a $128.8m stake.
Earlier this month, Morning Wire revealed that Baillie Gifford and its investment trusts had slashed their stake in Tesla, which is also run by Spacex CEO Musk.
The Edinburgh-based investment manager first invested in Musk’s electric car company in 2013, but said that it had now reduced its stake to just 0.06 per cent of the company’s shares.
Other strong performers in Schiehallion’s portfolio over the last year beyond Spacex included its second largest holding, Italian tech firm Bending Spoons, which jumped 89 per cent, while Tiktok owner Bytedance grew 33 per cent.
Across the year, the trust made six new holdings, including Runway AI, a generative-AI video firm, and Tenstorrent, a semiconductor design company.
However, one of the trust’s holdings, Swedish electric vehicle battery maker Northvolt, went bankrupt during the year due to increased competition from China, while others saw significant declines in valuation.
These included financial solutions provider Brex (30 per cent decline), Australian online pet supply company, Pet Circle (-44 per cent) and German bus and train operator, Flix (-27 per cent).