Monday 30 November 2020 5:30 pm

Investors in collapsed Woodford fund set for £100m payout

Investors trapped in Neil Woodford’s collapsed flagship fund are set to share a payout of just under £100m by the end of the year.

In a letter today fund administrator Link said it has raised a further £98m after selling off more parts of the portfolio’s assets. It said investors will be paid on or around 11 December.

Read more: First Woodford court battle could come this year

The cash return marks the fourth tranche of payouts from the fund, which was suspended in June last year after it was overwhelmed with withdrawal requests.

It was then shuttered by former star stockpicker Woodford in October, capping off the investment industry’s biggest crisis in years.

Link, which has overseen the liquidation of the fund, has agreed a £224m deal to sell 18 healthcare stocks to Acacia Research.

Investors have already been handed £183m as a result of the deal, and the latest tranche will come after the remaining assets have been transferred.

Link had aimed to complete the sale by the end of November, but said the “formalities” of the sale to Acacia had taken longer than expected.

The latest payment will take the total sum repaid to investors to £2.5bn, though it represents only a third of the remaining money trapped in the fund.

Link said it was unable to advise when the remainder of the trapped funds would be returned to investors, but warned that the remaining assets were less liquid and may not be sold until mid to late 2021. 

Read more: Investors stuck in Woodford fund face further repayment delays

Ryan Hughes, head of active portfolios at AJ Bell, said the payout would be “cautiously welcomed” by investors, but added it “won’t represent much of a Christmas present given the scale of overall losses”.

Last month it emerged that London lawyers are preparing a class action lawsuit against Link, marking what could be the first of many legal claims over the fund’s collapse.

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