The former flagship fund of Neil Woodford is not expected to be fully wound down and with final funds returned to investors until next year, its fund administrator says.
Link Fund Solutions sent a letter to the locked-in investors of the former Woodford Equity Income fund revealing the value of the fund’s remaining assets is £123.57mln, having being written down from £288mln earlier this year.
Despite winding down the fund, Link has made follow-on investments in two companies, where it said it was “seeking to protect value in the fund’s remaining investments”.
These follow-on investments include £1.5mln injected into Mafic, a loss-making basalt producer, to help it with “meeting required cashflow”, and £0.28mln in clinical biotechnology company Origin, which is aiming to develop a woundcare treatment.
Link said Mafic has now “appointed an investment bank with the intention, in the latter part of 2021, to seek a trade buyer”.
The fund assets are currently held in nine companies: drug discovery startup Benevolent AI, oncology provider Rutherford Healthcare, next-generation battery developer Nexeon, digital challenger Atom Bank, venture capital firm Cambridge Innovation Capital, luxury Ibiza property scheme Sabina Estates, Mafic and one of its major suppliers RM2 (LSE:RN2), plus the BlackRock (NYSE:BLK) ICS Sterling Liquidity Fund, a vehicle being used to invest proceeds of sales prior to making a capital distribution.
Link told investors in the latter that it continues to “make progress regarding the sale of the remaining assets” and “it is hoped that the sale of the remaining assets will be concluded in 2022”.
However it said it is “not possible to provide a definitive end date”, which investors know all too well, with the date having been shifted from “late 2021” in an update in March and “mid to late 2021” in last October’s update.
Investors have had £2.54bn of capital returned via four capital distributions, but Link has overseen losses of £875mln since the fund was suspended in 2019, with writedowns of the fund’s unquoted holdings alongside a cut-price £224mln sale of 19 life sciences holdings to US investor Acacia Research (NASDAQ:ACTG) – where the several assets have since rocketed in value.