Neil Woodford’s Role at His Own Listed Trust Still in Doubt
Neil Woodford’s Role at His Own Listed Trust Remains in Doubt
(Bloomberg) -- The board of Neil Woodford’s listed investment trust is keeping the one-time star stock picker dangling as it looks around for a potential replacement.
The board of Woodford Patient Capital Trust Plc said on Monday that it “continues to evaluate the position of the portfolio manager and remains in dialogue with other potential managers.” Woodford’s position at the trust was first placed in doubt in July, deepening a career crisis that began a month earlier when he stunned the financial world by freezing his flagship fund.
The LF Woodford Equity Income Fund has been locked ever since, but the trust has remained opened -- and paid the price. Its shares have plunged about 43% in that time, driving its market capitalization down to 400 million pounds ($492 million), about half the amount raised when the trust was launched in 2015.
Woodford endured another indignity in early September when he ceded control over investment decisions for the trust to its banker in exchange for greater leeway in how he uses money borrowed from the firm, Northern Trust Corp. Valuations of assets including stakes in IH Holdings International Ltd. and BenevolentAI Ltd. have also been reduced.
Woodford apologized in Monday’s statement for “an extremely disappointing six-month period” for shareholders in the trust.
‘More Painful’
“The journey to positive outcomes has been longer and more painful than investors would have liked, or anticipated, but the returns to be gained by delivering on the progress, I believe, will ultimately reward the patient investor,” Woodford said in the statement.
Raymond Abbott joins the board as an independent non-executive director as of Oct. 1, while Louise Makin departs. Abbott is chairman of Foresight 4 VCT Plc and of Integrated Environmental Solutions Ltd., according to the statement.
The shakeup of the board, which also included the arrival of Jane Tufnell and Stephen Cohen, is now finished for the time being, the firm said.
The trust’s daily net asset value plunged by 20.9% in the period from June 28 through Sept. 26, representing a decline in the portfolio NAV to 591 million pounds, according to the statement. The board said it’s considering reporting net asset value on a monthly or quarterly basis, abandoning its current practice of daily reporting.
“As the portfolio develops there is more information to review and analyze in relation to our investee companies,” according to the statement. “This analysis and the governance that appropriately exists around the valuation process takes time and will become increasingly unsuited to the publication of a daily NAV.”
To contact the reporter on this story: Suzy Waite in London at swaite8@bloomberg.net
To contact the editors responsible for this story: Shelley Robinson at ssmith118@bloomberg.net, Patrick Henry
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