Link Fund Solutions is seeking to avoid winding down Woodford Income Focus like it did with Woodford Equity Income as it holds meetings with managers shortlisted to take over the suspended fund.
Link, which serves as the authorised corporate director of Neil Woodford’s funds, is whittling down the candidates with the help of an independent research firm.
“We are of the opinion that appointing a new investment manager or facilitating a scheme of arrangement continue to be the options that provide the benefits of continuity and certainty for investors,” Link Fund Solutions director Karl Midl said in a letter.
Winding down the fund would remain an option if neither of those two options worked out.
Woodford Income Focus suspended on 15 October, immediately following news that Woodford Investment Management was winding down. Over that period Woodford Income Focus has returned -0.33% against the FTSE All Share’s 2.12%.
Link must keep investors trapped in the fund updated every 28 days.
Link conducts initial meetings with shortlisted managers
Midl confirmed the ACD has held “initial meetings” with shortlisted candidates to confirm their suitability.
Schroders, Blackrock and Jupiter have all been pegged as possible candidates to inherit the fund, with commentators noting the former two are big enough to absorb the fallout from the Woodford brand.
Schroders recently won Woodford’s £530m Patient Capital Trust, while Blackrock has agreed to sell down the listed stocks in Woodford’s flagship fund which will be wound up next year.
In addition to appointing a replacement alternative investment manager to step in for Woodford with Link continuing to act as the fund’s ACD, it is also weighing up whether a fund merger is appropriate, Midl said.
If Link determines that neither option is in the best interest of investors it intends to seek approval from the Financial Conduct Authority to wind-up the fund.
Woodford Income Focus suspension continues
In the meantime, Woodford Income Focus will continue to be suspended, Midl said.
“As the exceptional circumstances that led to the Fund’s suspension continue to prevail we have, in conjunction with Northern Trust Global Services SE, (UK Branch), the Fund’s depositary, concluded that it remains in the best interests of all investors in the Fund to continue the suspension of the issue, cancellation, sale and redemption of shares,” he explained in the letter. “This will also enable us to conclude our review of the options for the Fund.”
Midl added that Woodford “continues to work collaboratively” with Link as the investment manager of the fund which “continues to be managed in accordance with its investment objective and strategy”.
Link and Northern Trust will write to unitholders about the fund’s suspension status again no later than 10 December.
