Kent Council Fund recoups £139m from Woodford investment

In a letter sent on Tuesday, Link Fund Solutions told investors they would receive between 46.3p and 58.9p per share, depending on who was involved in the fund’s distribution and whether the investor was in accumulation or receiving an income on their investment.

On Wednesday, a spokesperson for the Kent fund said: “We can confirm that we have received a letter from the administrators of the Woodford fund stating that we will be receiving an initial sum of £138.9m tomorrow.

“We have also been advised that further sums will be forthcoming dependent on the sale of the assets of the fund.” 

The value of the pension scheme’s investment in the Woodford fund at the time it was gated was £237.6m.

The Kent County Council Superannuation Fund, with a total of £6.6bn in assets, has roughly 3 per cent of its holdings invested in the Woodford Equity Income fund.

Woodford IM’s flagship fund had been struggling with outflows, which were running at a net £9m per working day in May 2019.

But in June, Kent County Council asked to withdraw all of the £250m it had invested with Woodford through its pension fund, and Kier Group – one of the strategy’s substantial holdings – announced a profit warning that prompted its shares to plummet by 40 per cent.

Co-founder Neil Woodford’s representatives had played down fears about the fund’s liquidity, saying outflows had become moderate and that the manager remained as confident as ever his strategy would pay off.

But when Kent County Council’s request arrived, the fund did not have enough liquidity to meet the redemptions and was suspended.

Since then, Mr Woodford has been scrambling to sell shares to improve the fund’s liquidity in an effort to pre-empt a wave of redemptions when the strategy reopened.

But in October, it was announced that the suspended fund, initially touted to reopen in December, would be wound down and the former star manager fired from the fund.