The move follows reports on 15 October 2019 that the Woodford Equity Income Fund would be wound up.
The disgraced fund manager said: “We have taken the highly painful decision to close Woodford Investment Management.
“We will fulfil our fund management responsibilities to [Woodford Patient Capital Trust (WPCT)] and the LF Woodford Income Focus Fund and, once completed, will close the company in an orderly fashion.
“I personally deeply regret the impact events have had on individuals who placed their faith in Woodford Investment Management and invested in our funds.”
As reported by our sister publication Portfolio Adviser, authorised coporate director Link Fund Solutions confirmed it had suspended the Woodford Income Focus fund in an update to investors on Wednesday.
The right choice
While undoubtedly painful for Woodford, many believe shutting down the firm was the right call.
“The future of Woodford Investment Management was bleak. The decision to close the company is unfortunately the right one as it will put a stop to the inevitable speculation,” said Adrian Lowcock, head of personal investing at Willis Owen.
“Woodford’s decision to step down from the board of Woodford Patient Capital Trust was no doubt a hard decision but, given Woodford’s presence had become a distraction to the trust, it was also the right thing to do.
“Investors money is ring-fenced and will remain invested in the respective funds and in the underlying investments,” Lowcock added.
Customers in the middle
“The closure of Woodford Investment Management had a feeling of inevitability about it,” added Ryan Hughes, head of active portfolios at AJ Bell.
“Without the fees from the equity income fund and with no performance fee coming from the Patient Capital Trust, it was difficult to see how the business could survive.
“This creates further uncertainty for a larger number of customers and the key now is that they are given information about what is going to happen to their investments as soon as possible.
“The board of the Patient Capital Trust has clearly been considering its options already and I’d expect to see an announcement very soon from them.”