Economy

Trading in second Woodford fund suspended: administrator

Trading in second Woodford fund suspended: administrator”

The fund was initially suspended after anxious investors started withdrawing their cash, but, because Mr Woodford and his team had bought stakes in so many unlisted companies, selling the assets was extremely hard. Link concluded investors would get their money back more quickly if the assets were sold and the money distributed in stages - though the prices secured for assets of which the fund is a forced seller may of course face pressure.

LFS considers the winding-up of the WEIF to be in the best interests of all investors and will enable the return of cash to investors at the earliest opportunity.

There has been criticism that, in the meantime, Woodford continued to charge fund fees of about £65,000 a day to customers.

Neil Woodford, once hailed as the greatest stock-picker of his generation, has also been dumped from having any further involvement in the fund, with investors told they can not expect to see their money returned until at least the end of January.

The Woodford fund was suspended in June following a surge in redemption requests from investors, including one from the Kent local authority pension fund, and today it was announced that it is to be wound up as soon as practicable rather than re-opened.

Woodford's name is also being removed from the fund, which will be renamed the LF Equity Income Fund, and the assets handed to BlackRock and Park Hill for sale.

While investors in the Woodford Equity Income Fund cannot now buy or sell units, trading in the Multi-Manager funds is not restricted and you can buy and sell the portfolios as normal. As a result, the impact of one of these funds on the Multi-Manager portfolios' performance is limited. The investment vehicle, worth about £750m two years ago, could be closed permanently like the Equity Income fund, Link said. Please see the fund factsheets for more details.

In a letter to investors, Woodford Equity Income Fund's authorised corporate director Link Fund Solutions said the suspension in June was created to give Woodford Investment Management time to reposition the fund's portfolio into more easily sellable investments but that while progress was made, it was not sufficient to provide reasonable assurance as to when the repositioning would be fully achieved.

But on Tuesday the decision was made to close it instead.

As always we're determined to deliver the best long-term outcomes for investors in our Multi-Manager funds.

The HL Multi-Manager Funds are managed by our sister company HL Fund Managers Ltd.



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