Ryan Hughes, AJ Bell head of investment partnerships, has commented on today’s letter from Link Fund Solutions to investors in the LF Equity Income Fund (Woodford Equity Income Fund).
He said: “Investors will be pleased to see further details regarding the redress scheme on the Woodford Equity Income fund which sets out the potential amount available for distribution and the timeframe around this. This is an important next step for investors looking to be compensated for the failure of the fund, with c£230m being earmarked as available for investors who held the fund at the point of suspension on 3rd June 2019. While this remains subject to the successful completion of the sale of the Link Fund Solutions business and the approval of the scheme by investors, the communication of additional detail should prove to be a strong indicator that the sale is close to completion. Investors will now need to think carefully about how they wish to vote on the proposed scheme, which will happen towards the end of the year.
“Should these two key steps be successfully completed, investors should get a first tranche of payment in the first quarter of 2024, which looks like it will make up the bulk of the redress. However, there will likely be a further payment or payments to a much lesser degree at some point later in 2024.
“As a result, the light at the end of the tunnel for investors is coming much closer into view, but there is still a high probability that this will not be fully completed until at least the middle of 2024, at which point five years will have passed since the suspension. Investors have been hugely patient in this long, drawn out process but hopefully they can genuinely see an end is in sight.”