Baillie Gifford is one of those atypical investment firm behemoths in Britain—well-known within fund management and financial circles with its £192.9bn ($249bn) of assets under management but is not exactly a recognisable name on the street.
That changed when James Anderson, a partner and portfolio manager at Baillie Gifford, which is the fourth-largest shareholder of Tesla (TSLA), called for Elon Musk to stop getting embroiled in public spats and focus on company goals.
“We are very supportive, but we would like peace and execution at this stage. It would be good to just concentrate on the core task,” said Anderson in an interview with Bloomberg in July. The comments are especially pertinent considering Tesla has either missed or delayed production of its newest car, the Model 3, since it started building it in late 2017.
And it seems Musk didn’t listen. Less than a month later, he declared on Twitter that he had “secured funding” to take Tesla private and later backtracked on his tweets.
So, what is Baillie Gifford?
The investment management firm is an independent private partnership, meaning that its owned by its 44 members and prides itself on quietly doing its business.
With nearly a quarter of a trillion pound of assets under management, the firm has its headquarters in Edinburgh, Scotland and has offices in London as well as New York. This year, the group has gone from strength-to-strength with impressive returns across a number of funds.
Meanwhile, although it has clients across the globe, it counts five of the seven largest pension funds in the US as its customers. It also recently raised £173m ($223m) for its ‘patient capital-style’ US Growth Trust, which invests predominantly in listed and unlisted US companies which Baillie Gifford believes have the potential to grow substantially faster than the average company. The fund includes holdings in Amazon (AMZN), Netflix (NFLX), Facebook (FB), and Tesla (TSLA).
What’s Baillie Gifford’s involvement with Tesla?
As of the end of the first quarter this year, Baillie Gifford held 12.8 million Tesla shares. This is worth about $4bn based on the share prices (TSLA) on 28 August.
It also makes it Tesla’s fourth-largest shareholder currently, and one of the three investment firms that hold a large slice of outstanding Tesla shares. According to Bloomberg data, only Musk, T. Rowe Price (TROW), and Fidelity (FFIDX) owner FMR LLC have bigger positions.
Baillie Gifford is in it for the long-haul. James Anderson, one of the firm’s portfolio managers which bought into the group in 2013 through his £7.9bn ($10.2bn) Scottish Mortgage Trust (SMT.L), which holds about 5.7% of its assets in the stock, according to CityWire. It also crowned Anderson as one of Britain’s top technology investors.
Anderson also knows Musk personally and has been the most vocal in recent months amid the Tesla CEO’s erratic behaviour on social media or on the now infamous analyst call. In response to Musk calling a Thailand diver a “pedo,” Anderson told The Guardian he was “frustrated that the real steps towards [the end of carbon] are being overshadowed and undermined by this saga.”
He later also spoke to The Times about how Musk had under-valued the company after he tweeted about taking Tesla private. Its value was “much higher than $420 a share, probability-adjusted,” said Anderson.