Investors in Woodford Investment Management Ltd.'s flagship LF Woodford Equity Income Fund may not receive their money for more than one year due to the complexity of closing down the fund, City A.M. reported, citing industry professionals.
Link Fund Solutions, the fund's authorized administrator, previously said the decision to shut down the fund as soon as possible was in the best interest of all investors to protect them from an increased level of redemptions because it will allow for a faster return of money to investors than if the fund remained suspended.
Link said the process is expected to begin Jan. 17, 2020, subject to regulatory approval, and the first payment to investors is expected to be made by the end of that month after a relatively straightforward sell-off of its listed holdings.
However, Ryan Hughes, head of active portfolios at AJ Bell, told the newspaper that the fund's closure could take between six and 12 months from January to conclude since Link is unlikely to rush the process and hurt the price of the fund's assets.
Adrian Lowcock, head of personal investing at Willis Owen, said he also expects the closure to last between six months and a year, noting that selling the fund's unlisted and highly illiquid holdings will be time-intensive and difficult to carry out.