Woodford Raises $379 Million Since Locking Up Flagship Fund

(Bloomberg) -- Embattled U.K. fund manager Neil Woodford raised at least 300 million pounds ($379 million) by selling down some stakes held in his flagship fund since he froze redemptions last month.

Woodford shocked the financial world last month by halting withdrawals from his LF Woodford Equity Income Fund as clients demanded their money after a run of poor results. Woodford’s firm said the suspension would give him time to sell off “unquoted and less liquid” stocks in the fund’s portfolio, allowing him to meet future redemption requests.

In June, Woodford sold down stakes in BCA Marketplace, NewRiver REIT Plc and Oakley Capital Investments, among other positions, according to public filings and data compiled by Bloomberg. On Monday, Raven Property Group agreed to a share buyback that would take Woodford’s total raised to at least 326 million pounds.

A spokesman said Woodford Investment Management is holding some of the money raised in cash as well as investing in other stocks. He declined to elaborate.

Smaller Companies

When Woodford started out on his own in 2014, he mainly invested in large, liquid stocks. Over time, he slowly shifted into smaller and smaller companies, dramatically shifting the makeup of the portfolio. Nearly 97% of the assets in his flagship fund at the end of May were allocated to micro, small and mid-cap stocks, up from 40% in January 2016, according to Morningstar data. Some of the companies, including Industrial Heat and Benevolent AI, weren’t even listed on major exchanges.

The firm’s fund administrator, Link Asset Services, will inform the Financial Conduct Authority on Monday whether it will lift the suspension or keep the gates in place for another 28 days.

The Times newspaper has reported that the ban is set to be extended indefinitely because Woodford’s fund is in no shape to withstand the expected redemption requests.

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