Scottish Mortgage asks buyers for permission to extend personal agency publicity as SpaceX valuation soars

Scottish Mortgage is seeking permission to amend its investment policy so it can increase its stakes in private companies.

The investment trust, which holds £15.2billion in assets, is asking to invest up to £250million more into unquoted companies, even when its limit on private companies has been breached.

Scottish Mortgage, which is among the country’s most popular investment vehicles, holds stakes in successful private firms such as SpaceX. However, the current policy only allows the trust’s manager to invest a maximum of 30 per cent of the total assets in private companies.

This additional capacity would allow managers Tom Slater and Lawrence Burns to make investments in private companies when its holdings in unquoted companies exceed the 30 per cent limit.

The trust said its exposure to privately held assets can fluctuate because of factors outside of its control, including share buybacks and revaluations.

In an update to investors, Scottish Mortgage said: ‘This can result in the private companies exposure approaching, or increasing above, the 30 per cent limit without any additional investment activity.’

For example, the revaluation of SpaceX at the end of 2025 means that it now holds a larger proportion of Scottish Mortgage’s total assets – approximately 15.1 per cent compared with 8.2 per cent in November.

If SpaceX floats this summer, as is widely expected, Scottish Mortgage’s private equity exposure would fall below 30 per cent. However, its other private holdings, such as AI giant Anthropic and payments processor Stripe, could see an uplift in their valuations.

The proposal requires approval by shareholders at its general meeting on 10 April.

Scottish Mortgage soared in popularity during the pandemic as investors looked for exposure to tech companies but suffered from the spike in inflation and rising interest rates in 2022. It meant that its private holdings became a bigger proportion of its portfolio.

While it faced criticism from investors and analysts concerned about transparency, particularly because private valuations are irregular, these holdings are now its biggest draw, particularly its investment in SpaceX, Anthropic and OpenAI.

Dan Coatsworth, head of markets at AJ Bell said: ‘The the issues around a lack of transparency, irregular valuation updates, and liquidity, haven’t gone away with regard to private companies. 

‘That’s perhaps why Scottish Mortgage is only asking for a relatively small change to its investment policy rather than asking investors if it can go big. If SpaceX’s IPO does go ahead as expected, Scottish Mortgage would suddenly have a lot less exposure to private markets as Elon Musk’s rockets-to-satellites group currently represents a hefty chunk of its private positions.’

Scottish Mortgage shares rose 0.94 per cent to 1,193p and are up 23 per cent over the last year.