Law Debenture combines a predominantly UK-focused equity portfolio with a wholly owned Independent Professional Services business, creating a structure that differs materially from conventional equity income trusts. The professional services operation provides recurring revenue that supports the dividend, giving the portfolio managers greater freedom to invest beyond companies offering high current yields.
Kepler considers Law Debenture’s combination of a diversified equity portfolio and its Independent Professional Services business to be a key differentiator within the UK equity income sector. The recurring revenue generated by the services operation supports a meaningful proportion of the dividend and gives the portfolio managers greater flexibility to invest in lower-yielding companies with stronger long-term growth potential. Kepler also highlights the trust’s relatively low ongoing charges and established dividend record, while noting that its premium valuation, structural gearing and exposure to smaller companies require careful consideration.
Law Debenture Corporation plc (LON:LWDB) provides a wider range of services including corporate and pension trusts, process agent services, treasury management, corporate services including for special purpose vehicles, structured finance administration and whistleblowing services.
