Woodford’s Patient Capital is UK’s biggest trust launch

Neil Woodford’s Patient Capital Trust, the second offering from the star manager’s company, is the largest ever UK investment company launch, according to the Association of Investment Companies.

Woodford’s Patient Capital is UK’s biggest trust launch

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The trust’s initial public offering raised £800m ($1.2bn), breaking the previous record set when Mercury European Privatisation Fund raised £549m at its launch in 1994.

The Mercury Fund broke the record set just one month earlier by the Kleinwort European Privatisation Fund, which raised £481m, and pushed Fidelity’s China Special Situations Fund, launched in April 2010 and raised £460m, into fourth place.

“It’s a testament to the investment company sector that this distinctive company is taking advantage of the benefits of the closed-ended structure, such as the ability to invest in specialist, small, less liquid assets,” said AIC  chief executive Ian Sayers.

Woodford Patient Capital Trust originally targeted £200m but increased the IPO to £800m due to high investor demand. It is due to list on the stock market on 21 April.

The trust aims to achieve long-term capital growth through investing in a portfolio consisting predominantly of UK companies, both quoted and unquoted.

Initially, the portfolio is expected to be dominated by mid- and large-cap listed, mature companies that offer growth opportunities, however over time the exposure to listed, early-stage and early-growth companies will gradually build.

Ultimately the portfolio is expected to consist of 25% in mid and large listed mature companies, 25% in early-growth companies which may be quoted or unquoted, and 50% invested in early-stage companies, also both quoted and unquoted.

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