Energy Fund's Value Gap Sparks Activist Push for Formal Sale

LONDON, UK – September 15, 2026 – A public battle over value and strategy has erupted in the UK’s burgeoning energy storage sector. Activist investor PrimeStone Capital LLP today reiterated its demand for a formal sale of Gresham House Energy Storage Fund plc (GRID), one of the country's largest battery storage operators. The move puts the investor, which holds a 7% stake, in direct opposition to GRID's board, which insists its current strategy will deliver superior long-term returns for shareholders.

The dispute highlights a critical challenge for publicly listed infrastructure funds: a persistent and often widening gap between the market's perception of their value and the intrinsic worth of their physical assets. For GRID, this gap is a chasm, with its share price languishing at a 26% discount to its Net Asset Value (NAV), a key metric for investment trusts. This valuation disconnect has become the central battleground in a debate that could reshape the future of a key player in the UK's energy transition.

A Tale of Two Valuations

At the heart of the conflict lies a simple but stark mathematical discrepancy. As of this morning, GRID’s shares traded at 96.8p, while its independently assessed NAV stood at 131.3p per share. For PrimeStone Capital, this 26% discount is untenable. "Our core conviction remains unaltered: the listed structure generates a widening gap between the intrinsic value being created and the price at which shareholders are able to realise it," the firm stated in a public announcement.

Following months of what it describes as "constructive dialogue" with GRID’s board and fellow shareholders, PrimeStone argues that a formal sale process is the "surest route to crystallise the value." The firm notes that while it found strong support for GRID's underlying strategy, it found "significant, if not stronger, support for a formal sale process." This sentiment is echoed by others in the market, including the managers of the MIGO Opportunities Trust, who have publicly backed PrimeStone’s call.

However, GRID’s board has firmly rejected this path. In a response issued this morning, the company stated that initiating a sale now "would not be in the best interests of shareholders." The board points to its recent performance as proof that its strategy is working. The fund has delivered a 48.3% share price total return over the past 12 months, far outpacing the 9.1% sector average. Furthermore, its NAV per share jumped nearly 16% in the first half of 2026 alone. According to one analyst, the board has "bought itself time rather than won the argument," suggesting the pressure will remain until the discount meaningfully closes.

The Hidden Value in Grid Connections

Ironically, both the activist investor and the company's board agree on one key point: GRID possesses significant, untapped value that is not yet reflected in its NAV. The debate is about the best way to realize that value. Two key areas are at the forefront: "Alternative Revenues" and the burgeoning demand for grid connections from power-hungry data centers.

GRID’s strategy for "Alternative Revenues" is already showing early success, with a trial program reportedly exceeding expectations. The company is now scaling this to commercial capacity, targeting an ambitious £25 million in incremental annual EBITDA when fully operational. This new income stream represents a significant potential uplift for the fund's bottom line.

Even more tantalizing is the value locked within GRID’s grid connections, particularly for the rapidly expanding data center industry. As artificial intelligence and cloud computing drive exponential growth in data processing, the demand for reliable, high-capacity power has become a critical bottleneck. Battery energy storage systems (BESS) are emerging as a crucial solution, providing grid stability and uninterruptible power. The global market for BESS for data centers is projected to explode from $7.4 billion this year to over $90 billion by 2032. PrimeStone explicitly notes that the "considerable value of grid connections for data centres" is not currently included in GRID's NAV. The board has also acknowledged these "broadening revenue streams" as a key area of future growth yet to be fully recognized. For GRID’s board, selling now would mean handing this future upside to a buyer at a discount.

An Activist's Proven Playbook

The pressure on GRID's board comes from a seasoned and methodical activist. Founded in 2014 by three former partners from private equity giant The Carlyle Group, PrimeStone Capital has built a reputation for its deep, private equity-style research and its strategy of "constructive engagement." The firm takes substantial minority stakes in public companies it believes are undervalued and then works to unlock that value.

Its track record demonstrates a willingness to push for significant strategic shifts. In Germany, PrimeStone successfully campaigned for the chemical distributor Brenntag to consider a breakup into two separate divisions after blocking a major merger. Its engagements with UK firms like Johnson Service Group and SMS plc have been described by management as "constructive and supportive" yet "pleasantly and positively demanding." This history suggests that PrimeStone is prepared for a sustained campaign to achieve its objectives at GRID, viewing the current situation not as a short-term trade but as a long-term value creation opportunity that is being mismanaged by the public market structure.

A Fork in the Road

With GRID's board holding firm and PrimeStone vowing to continue its dialogue, the company stands at a strategic crossroads. The board is betting that the successful execution of its growth plan—including the build-out of new projects and the commercialization of new revenue streams—will eventually force the market to recognize the fund's true value and close the discount organically.

Meanwhile, the path advocated by PrimeStone, a "formal sale process," would initiate a structured auction for the company under UK Takeover Panel rules. This would invite potential buyers, likely including large infrastructure funds and global energy players, to bid for GRID's entire portfolio of assets. The M&A landscape for energy storage assets is currently robust, with significant capital looking for high-quality operational platforms. A competitive bidding process could deliver a substantial premium for shareholders, crystallizing the value that PrimeStone believes is trapped.

The board’s immediate challenge is to convince a critical mass of shareholders that waiting for future growth is more lucrative than accepting a potential takeover offer in the near term. With GRID's interim results scheduled for release on September 23, all eyes will be on the company to provide further tangible evidence that its strategy can deliver where the market has so far failed.