Link Fund Solutions Ltd., the authorized administrator of Woodford Investment Management Ltd.'s suspended flagship £3.7 billion LF Woodford Equity Income Fund, decided to continue the suspension of the fund until early December, saying the move remains in the interests of all investors.
Link said the fund fell 11.15% between when it was suspended June 3 and Aug. 21, underperforming a 1.52% gain in the FTSE All Share Total Return benchmark.
In a blog post, Woodford said the performance was mainly due to the share price decline of two of the fund's larger holdings, litigation finance firm Burford Capital Ltd. and cold fusion technology firm Industrial Heat.
Burford's share price tumbled after its accounting practices came under fire in a report published by U.S. hedge fund Muddy Waters, LLC. Burford subsequently said it found trading activity consistent with material illegal activity around the time its share price fell when it was shorted by the hedge fund.
Meanwhile, Woodford said Link reviewed the fund's unquoted stake in Industrial Heat as part of a six-monthly review process and determined that progress was not at the pace expected at the time of previous reviews.
Woodford noted that it has decided, after consulting with Link, to withhold disclosing the fund's top ten holdings while it remains suspended.
Separately, Link Fund Solutions has informed Woodford Patient Capital Trust plc that it intends to cut the valuation of its stake in Industrial Heat unit IH Holdings International Ltd. to reflect a reassessment of the company's current progress.
The trust said the valuation adjustment is expected to impact its net asset value by roughly 3.4 pence per share, which will be reflected in its net asset value as of Aug. 23 and announced Aug. 27.
