Neil Woodford has sold more than half his shares in his listed investment fund – whose board is considering sacking him and bringing in another asset manager.
The stock picker sold 1.75m shares in Woodford Patient Capital Trust between 3 July and 8 July. At the average share price between those dates, the sale would have made Woodford just less than £1m, Reuters calculated.
Woodford, who told the fund’s board about the share sale on 27 July, said he needed the money for a tax bill and other commitments. The Patient Capital Trust is one of several managed by his company Woodford Investment Management.
He said he was forced to sell the shares after taking no income or dividends from Woodford Investment Management, after blocking customers from another fund, the Woodford Equity Income Fund, two months ago.
Investors are due to hear on Monday whether the suspension of the Equity Income Fund will be extended by another month. Investor fury at Woodford for continuing to take millions of pounds in fees while their money is locked up has added to the controversy surrounding the former star fund manager.
The explanation from Woodford’s company to the board for selling his Patient Capital Trust shares said: “Whilst a reluctant seller, between 3 and 8 July Mr Woodford sold 1.75m of his WPCT shares (around 60% of his holding). The sole reason that he did so was in order to meet personal financial obligations, including a tax liability.”
The board said that although it was not strictly required to disclose Woodford’s share sale, it had decided to release the information to the public. Woodford is left with 1.25m shares representing 0.14% of the Patient Capital Trust.
A spokesperson for Woodford said: “Neil remains invested in WPCT and completely committed to the early-stage asset class and its long-term investment potential.”
Woodford Patient Capital Trust has an independent board whose job is to act in the interests of shareholders. The board also revealed it was considering replacing Woodford as the fund’s portfolio manager after receiving approaches from other potential candidates.
The board said: “Whilst the board remains confident in the portfolio manager’s commitment to WPCT and the current day-to-day management of the portfolio, the board intends to engage with a broader range of third-party managers in order to undertake a full assessment of all potential management options, which may or may not lead to a change in the company’s management arrangements.”
If the board replaces Woodford it will be a further blow to the reputation of the UK’s most famous fund manager and a former favourite with retail investors. After building his reputation at Invesco, Woodford launched his own business in 2013 but he made bets on troubled companies such as Kier and Purplebricks that led to disastrous performance.
Woodford’s spokesperson said: “Neil is proud of the portfolio created and the considerable potential some of these companies have to achieve commercial success.”
Shares in Woodford Patient Capital Trust, down 38% this year, fell just over 3% to 51.6p.