Wirecard Bet Hammers Star U.K. Stock Picker
Wirecard Bet Hammers Star U.K. Stock Picker
(Bloomberg) -- Star U.K. stock picker Alexander Darwall’s investment trust slumped as its biggest holding went into freefall amid accounting concerns.
Wirecard AG accounted for just over 10% of the European Opportunities Trust Plc’s investments as of May 31, according to the website of Devon Equity Management, where Darwall is chief investment officer.
When the German payments firm delayed the release of its annual report for a fourth time on Thursday, shares in Darwall’s trust fell 11.6%. That was the biggest daily drop since 2008.
Devon’s Chief Executive Officer Richard Pavry declined to comment.
Darwall built his reputation over almost a quarter century at Jupiter Fund Management Plc, where he at one time managed nearly 8 billion pounds ($10 billion) focusing on large bets on European firms. Many of his vehicles were heavily invested in Wirecard, which had proven to be a profitable wager for the manager. In the 10 years before Darwall left Jupiter, the German firm’s share price surged from 6 euros to around 150 euros.
Wirecard stock dropped by a record 62% in Frankfurt on Thursday after auditors were unable to find about 1.9 billion euros ($2.1 billion) in cash, causing analysts to question liquidity at the German payments firm.
In January, Darwall apologized to investors of the trust about its large stake in Wirecard, and said at the time he would not have out-sized positions in any stock in the future. He also reiterated his confidence in the stock, despite a number of reports questioning the accounts of the growing business.
Investors pulled 4.5 billion pounds from Jupiter in 2019, which CEO Andrew Formica said was “almost entirely” because of Darwall’s decision to leave. His departure was announced in July last year.
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