Shares in Woodford Patient Capital Trust (WPCT), the listed fund of beleaguered stockpicker Neil Woodford, dropped over six per cent this morning after the company was forced to cut the value of one of its largest holdings, a controversial energy company backed by celebrities including Brad Pitt.
WPCT said this morning that Link Fund Solutions – which is responsible for valuing the fund’s unquoted assets – would be cutting the valuation of its stake in Industrial Heat, a controversial company that is trying to harness the power of cold fusion.
The fund said it expects the devaluation to cut the fund’s asset value by approximately 3.4p per share, which would represent around a four per cent drop in WPCT’s net asset value.
Industrial Heat is one of WPCT’s 10 largest holdings. The US-based company is attempting to develop power sources that are run on “low-energy nuclear reactions”, but has faced skepticism from mainstream scientists.
Less than a year ago, Link dramatically marked up the value of Woodford’s holding in the unquoted company by 357 per cent.
Link said its revaluation of Industrial Heat “considered that the company’s development had not progressed at the rate upon which previous reviews were based”.
A Woodford spokesperson said: “Woodford is not responsible for unquoted valuations across any of its funds. Link is ultimately responsible for the pricing and valuation of unquoted stocks and it employs an independent valuation company in the process.”
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