Interactive Investor

Neil Woodford investors to receive third payment this week

We explain how much cash from the fund will be distributed to investors and when payments will be made.

24th August 2020 10:59

Kyle Caldwell from interactive investor

We explain how much cash from the fund will be distributed to investors and when payments will be made. 

Neil Woodford investors will receive a third payment this week, as £183 million of assets are returned.

In a letter to those with money tied up in the LF Equity Income fund (formally named the LF Woodford Equity Income fund), investors were informed of the amount they will receive per share class, ranging from 4p to 5.1p, depending on the share class held. The letter added that since the closure of the fund last October, a total of £2.45 billion has been returned to investors. The fund’s value when it was shut stood at around £3 billion.

Investors will receive another letter today (24 August) outlining the individual amount that they will receive. Payments will made on or around 26 August, but may take a couple of days longer for those who invested in the fund through platforms.

In addition to details about the third payment, it was also announced by Link, the fund’s authorised corporate director, that the publication of the fund’s annual accounts for the year ending March 2020 will be delayed by a month – until 30 September at the latest.

Following the third payment, Link notes that “further capital distributions will be made as and when suitable amounts of cash have been raised from the sale of the assets of the fund”.

Investors were suspended from withdrawing their holdings in Woodford’s Equity Income fund in June 2019, due to the fund being unable to sell its illiquid assets to meet a heavy flow of redemptions.

The suspension eventually led to Link, the fund administrator, announcing in October that it would liquidate the fund, resulting in Woodford Asset Management closing.

How much money has been returned to investors?

Investors received more than 75% of the assets from payouts made in January and March 2020.

The first payment to investors, which was made at the end of January, was £2.1 billion, which is equivalent to around three-quarters of the fund’s assets.

In March, another payment was made, with investors receiving 3.1p to 3.9p per share, depending on the share class. This second sell-off raised £143 million.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.