Woodford fund suspensions
Update as of 16 October 2019
LF Woodford Equity Income Fund closure
On 15 October 2019, Link Fund Solutions, the Authorised Corporate Director (ACD) of the LF Woodford Equity Income Fund, announced that it intends to close the Woodford Equity Income Fund by selling the assets and returning the proceeds to investors.
The decision is subject to approval by the Financial Conduct Authority (FCA). Pending that approval, Link expects to start winding up the fund on 17 January 2020. Proceeds will then be placed into cash in clients’ existing accounts as interim payments, which will then be available for reinvestment. Link expects to start winding up the fund on 17 January 2020.
Link made the decision after a careful review of the fund and its holdings indicated that the repositioning of the portfolio did not provide reasonable certainty as to when the fund could be re-opened.
Woodford Investment Management will cease to be the investment manager of the fund, effective immediately. The fund will also be renamed as the LF Equity Income Fund.
You can read the official Q&A for full details of this announcement.
LF Woodford Income Focus Fund suspension
On 16 October 2019, Link Fund Solutions, the Authorised Corporate Director (ACD) of the LF Woodford Income Focus Fund, has decided to suspend dealing in shares in this fund, with effect from 15 October 2019 and until further notice. This means you will no longer be able to buy or sell shares in this fund.
We restricted new investments in the Woodford Income Focus Fund in June, because we felt this was in the best interests of our customers. That restriction remains; you will now not be able to invest in this fund through other investment platforms either.
The ACD decided to suspend this fund following the resignation of the fund's manager, Woodford Investment Management. The ACD believes this resignation would result in it being unable to meet redemption requests without prejudicing the interests of both remaining and redeeming investors.
The ACD believes the suspension is in the best interests of investors and during the suspension will consider the options available, including the appointment of an alternative investment manager, a scheme of arrangement into another fund or a winding-up of the fund.
The suspension will cease as soon as the ACD determines the course of action that is in the best interests of investors. The ACD will formally review the suspension at least every 28 days and expects to provide an update within the next 14 days.
You can read the official statement for full details of this announcement.
Woodford Patient Capital Trust plc
On 15 October, Woodford Investment Management announced that it will cease its role as portfolio manager of the Woodford Patient Capital Trust in January 2020.
The trust remains open for buys, sells and switches. Any regular savings plans and regular withdrawal plans linked to the trust will continue as usual.
The trust's board is in advanced discussions relating to the ongoing management of the portfolio and expects to announce details of the new management shortly.
As an investment trust, this is a different type of investment from LF Woodford Equity Income and LF Woodford Income Focus. Its shares are traded between investors on a secondary exchange. This means the fund manager does not have to dispose of holdings because an investor has decided to sell shares.
Here are answers to some of the questions you may have.