Andurand Capital Calls for Changes to Sprott Copper Trust Structure for Better Liquidity

Andurand Capital Seeks Reform of Sprott Physical Copper Trust

In a recent announcement, Andurand Capital Management Ltd (ACML) has made a significant move by deciding to discontinue its reliance on the Alternative Monthly Reporting System in relation to the Sprott Physical Copper Trust. This decision highlights ACML's concerns regarding the current performance issues of the Trust and the underwhelming trading conditions surrounding its units.

As of the market close on March 31, 2025, the units of the Sprott Physical Copper Trust have been trading at an alarming average discount of approximately 18% compared to their net asset value. This situation has been compounded by extremely low liquidity, with the average daily traded value falling below $200,000. Such a liquidity issue not only limits trading opportunities for investors but could also pose challenges in responding to market volatility.

To address these concerns, ACML has proposed crucial amendments to the Amended and Restated Trust Agreement of Sprott. Specifically, they are urging for changes that would align the redemption features of the units with those found in other physical metals trusts managed by Sprott Asset Management LP. By doing so, ACML believes it can help rectify the disconnection between the market price of physical copper and the value of the units, ultimately restoring investor confidence and market activity.

The importance of these amendments cannot be overstated. The Sprott Physical Copper Trust holds significant assets, but with reduced trading volume and investor interest at its current pace, it risks losing its appeal in the competitive landscape of metal investment trusts. ACML asserts that enhancing the redemption processes will provide a more investor-friendly environment, fostering better price alignment and attracting long-term investments.

Before this announcement, ACML held approximately 1,811,957 units, which represents about 16.4% of the outstanding units of the Trust. Their involvement in the Trust was strictly as an investment manager, and this decision was made without an intention to control or direct the operations of the Issuer.

Looking ahead, ACML remains open to exploring various strategies and actions to rectify the existing challenges. These may include engaging directly with other unitholders of the Issuer, requisitioning meetings, or pursuing proxy solicitations – all aimed at fostering change within the Trust’s operational structure.

As the investment landscape continues to evolve, ACML's articulate request for proactive amendments serves as a reminder of the importance of effective governance and investor protection in managing investment vehicles. In the fast-paced world of commodities and trusts, adapting to market realities is essential for sustainability.

Stakeholders and investors are encouraged to monitor ongoing developments related to the proposed changes. ACML's proactive stance highlights the critical role that both managers and investor sentiment play in shaping the future of investment products.

For further inquiries or to obtain additional information regarding this matter, interested parties can consult the Issuer's profile available on SEDAR+, or reach out directly to ACML via the provided contact details. This pathway will ensure that all stakeholders remain informed about critical updates regarding the Trust’s status and future direction.