Woodford investors to get further £142m payout
Investors in Neil Woodford's former flagship fund are in line to share a payout of almost £142m in the second distribution of capital since the fund was closed last year.
In January about £2.1bn was returned to 300,000 investors locked in the fund and were paid 46p to 57p a share out of the 100p launch price.
In a letter to investors, Link Fund Solutions. which is managing the fund's liquidation, said it had continued to sell assets since January and was now able to make a second distribution. The payout of £141.7m is equal to 19.9% of the fund's value on 10 March and takes the total allocated for return to £2.31bn.
Woodford’s equity income fund blocked withdrawals in June after its plunging value sparked a run of savers trying to get their money back. Woodford invested customers' money by taking large stakes in small and illiquid companies, many of which performed badly such as PurpleBricks and Burford Capital, leaving the former star fund manager stuck with the shares.
Link closed the fund, which was once worth £10bn, to withdrawals in June 2019 and sacked Woodford as its manager in October. After damaging revelations about his management of the fund many assumed Woodford's career was over but he is reported to be plotting a comeback.
Link said investors would receive a further letter on 20 March with details of the amount they would receive including their share of any sale proceeds raised by 17 March. The payment will be made on 25 March.
"It is intended that further capital distributions will be made as and when suitable amounts of cash have been raised from the sale of the remaining assets of the fund," Link said in the letter. "The assets that remain to be sold are the less liquid assets of the fund and disposing of these assets may take longer than was the case for the sales to date."
Ryan Hughes, head of active portfolios at AJ Bell, said: “Woodford Equity Income investors will be pleased that they are getting a little more of their money back … However, this distribution only represents 20% of the remaining assets, so there’s still a long way to go.
"What’s more, we’ve seen market conditions deteriorate considerably, meaning that selling any unlisted and illiquid assets is likely to become much harder. Sadly this means that it looks like investors are in for a long wait before they see the remainder of their money paid out of the fund."