Link Fund Solutions appoints PwC to advise on £235m Woodford redress scheme

Further details of the compensation scheme expected to be announced in September

Neil Woodford
Neil Woodford


Link Fund solutions (LFS) has appointed PwC to advise on the proposed £235m redress scheme to investors in the defunct LF Woodford Equity Income fund (Weif).

In a letter to investors, Link managing director Karl Midl said the firm had made ‘significant’ progress in developing the structure of the compensation scheme following discussions with the FCA.

AJ Bell head of investment partnerships Ryan Hughes said investors still in the former Woodford Equity Income fund will be pleased to see some progress in the potential settlement four years after the fund was closed in October 2019.

See also: £235m redress for investors agreed as Woodford saga nears wind-up

He said: “Today’s letter is the latest correspondence from Link to investors and gives further clarity on the potential timeline of the £235m settlement, which will give hope that the sale of Link is progressing as planned.

“With a number of distributions having been made to investors over the past 3 years the redress payment should take the recovery level to around 77% of the value of the fund on suspension, with a very small balance left in the few remaining unquoted companies that have still to be sold.”

Hughes added: “While the letter still does not present a firm timeline for the payment of this redress, as it is still subject to the successful sale of the business, news that details of how the scheme will operate will be provided in September at least gives investors a date to focus on.

“That will no doubt be eagerly awaited by investors who have had to wait over four years to get to this point. While the finish line may not quite be in sight, it does seem as though the sorry saga is getting close to entering the home straight.”

Subject to discussions with the regulator, Link expects to formally announce details of the scheme in September.

In April, LFS agreed to provide redress payment of up to £235m to investors still trapped in the collapsed Woodford Equity Income Fund (Weif), provided LFS’s proposed sale to Irish asset manager Weystone Group goes ahead.

Upon the conclusion of its investigation into LFS, the FCA said on 19 April that it had made “critical mistakes and errors”, as Weif’s authorised corporate director, in managing the fund’s liquidity.

In September last year, the FCA hit LFS with a £50m fine, and ordered that up to £306m be set aside to repay those investors still stranded in Neil Woodford’s (pictured) defunct strategy.

The fund was shuttered in 2019 after a wave of redemption requests exposed the strategy’s high exposure to illiquid assets, which meant it could no longer repay investors who wished to sell their holdings.

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