Regulatory filings have revealed a slew of holdings Neil Woodford is selling down to shore up liquidity in his gated £3.7bn Equity Income fund.
On Thursday alone he sliced his stakes in 13 different companies, bringing six below 5% and thereby relinquishing his major shareholder rights. Online estate agent Purplebricks, Provident Financial and housebuilders Crest Nicholson and Taylor Wimpey are among the liquid holdings Woodford has sold.
| Woodford Investment Management holding | Original stake | New stake |
| Babcock International | 5.03% | 0.58% |
| Barratt Developments | 5.07% | 4.82% |
| BCA Marketplace | 12.59% | 7.14% |
| Breedon | 6.83% | 0% |
| Card Factory | 8.94% | 2.31% |
| Circassia | 28.03% | 24.47% |
| Countryside Props | 15% | 10.20% |
| Crest Nicholson | 15.08% | 10.01% |
| e-therapeutics | 17.89% | 14.11% |
| Kier | 20.01% | 15.87% |
| NewRiver Reit | 20.60% | 15.61% |
| Paypoint | 14.84% | 10.98% |
| Provident Financial | 18.43% | 23.44% |
| Purplebricks | 23.87% | 21.51% |
| Redrow | 5.07% | 0.27% |
| Taylor Wimpey | 5.07% | 4.27% |
| Watkin Jones | 9.19% | 1.27% |
Source: FE Investegate
Woodford is like ‘kryptonite’
One source told Portfolio Adviser that having Woodford on your shareholder list now would be “kryptonite” for the share price and a sure-fire way to attract short sellers.
Shares in Woodford favourites, including Circassia, Burford, Evofem, Autolus and Stobart, dived on Tuesday as markets priced in the news about Woodford’s gated fund.
Attention has also been thrust onto Woodford’s successor at Invesco Mark Barnett.
There remains a decent amount of overlap between assets held in the Invesco High Income and Invesco Income funds run by Barnett and the Woodford Equity Income fund. Together Barnett and Woodford remain the joint largest shareholders of larger FTSE 250 holdings like Provident Financial and less liquid holdings like intellectual business Allied Minds, where they collectively own 50% of the business.
Trapped investors are the ones who suffer
The Woodford crisis has moved beyond the world of financial services and grabbed the attention of MPs and the regulator.
Former UK City minister, Paul Myners, slammed the equities manager on BBC Radio 4’s Today programme on Friday, who he said was “a star fund manager [who] was given far too much freedom”.
“Woodford held the same shares across all of its portfolios, and now you’ve got this sudden panic, he’s dumping his investments and so are other mangers who hold the same stocks, and those shares are being driven down to ridiculous low prices; and the people who are losing out are the end investors,” said Myners.
“The professionals are okay, the regulator will give itself two years to carry out a review of what went wrong, and the same risks will continue of allowing illiquid assets to be put in portfolios which are treated as though they are liquid.”
