The sale of a further ‘significant portion’ of the former Woodford Equity Income Fund’s assets has been agreed, the fund’s Authorised Corporate Director announced today.
In January, Link Fund Solutions began the process of winding up the LF Equity Income Fund and returning money to investors. It appointed BlackRock Advisors (UK) Limited and specialist stockbroker Park Hill to help sell the assets.
BlackRock has been managing the more liquid stocks in the Fund, known as Portfolio A, and Park Hill was appointed to manage the less easy to trade stocks known as Portfolio B.
Link announced today:
"Since we took the decision to wind up the Fund we have been exploring how best to sell the fund’s assets in a way that enables us to make capital distributions to investors and best protects investors’ interests. This included investigating a potential sale of a collection of the Fund’s holdings in companies from the healthcare sector.
We are now able to confirm to investors in the Fund that we have reached agreement with Acacia Research Corporation (“Acacia”) for the sale of an agreed selection of up to 19 of the fund’s healthcare assets in return for up to £223.9 million. The assets to be sold to Acacia are from Portfolio A and Portfolio B."
Selling assets like these can be a long process, and Link has said that the sale could take up to six months. The agreement will mean that Link can return more capital to investors in due course, but they can’t yet confirm exact dates and amounts.
There has been a reduction of 20% in the Fund’s net asset value. The NAV of the Fund was £558.438 million on 20 May 2020. Link has said the NAV was £444.219 million on 3 June. Link has said that it is possible that this NAV may vary as the market prices attributable to the Fund’s remaining assets may change prior to them being sold.
The assets being sold to Acacia make up 50.4% of the Fund’s remaining value (as at 3 June 2020). Link will provide more information by 29 July, and we’ll write to holders to let them know the details.