A growing number of institutional investors are pushing back against the merger of HICL Infrastructure and The Renewables Infrastructure Group, it was reported on Monday, over mounting concerns about how the proposed mega-deal has been structured.
According to The Times, 11 shareholders in HICL - which own around 9.3% between them - have now confirmed they will vote against the deal if it goes ahead in its current form.
Those opposed include TrinityBridge, which holds a 3.8% stake, W1M, Hawksmoor Investment Management and EQ Investors.
HICL announced plans to merge with rival investment trust and fellow FSTE 250 firm Trig last week.
The deal will bring together HICL's infrastructure assets - which range from utilities to transport - and Trig's renewables portfolio, which covers solar, wind and battery storage. The merged company would be worth around £3.98bn with net assets exceeding £5.3bn.
However, some investors are concerned that the structure disproportionately favours both Trig shareholders and InfraRed, the manager of both trusts.
Under the terms of the deal, Trig would be voluntarily wound up.
Its assets would then be transferred to HICL for new HICL shares and a £350m liquidity package, including a partial cash option and a commitment from the manager, which is owned by Sun Life, to buy shares after the deal.
HICL shareholders would own around 56% and Trig around 44% of the merged firm.
The Times said the investors had signed an open letter calling on HICL to abandon the plan.
The trust told the newspaper: "We continue to engage with shareholders and are listening to their views.
"We remain committed to the view that the proposed transaction is underpinned by compelling strategic rationale. It will unlock significant long-term value through increased diversification, liquidity and access to opportunities that will come from the creation of the UK's largest listed infrastructure investment company."
As at 1230 GMT, shares in HICL were up 1% at 113.04p, while Trig's were largely unchanged at 76p.