Skandia is closing its Skandia Invesco Perpetual High Income fund and Skandia Invesco Perpetual Income fund and moving clients into a newly created vehicle, the OMW Old Mutual Woodford Equity Income fund.
The new fund will be positioned in the firm’s WealthSelect Range. Both the Skandia Invesco Perpetual High Income fund and the Skandia Invesco Perpetual Income fund were positioned in Skandia’s Life insurance range, with a total mandate value of £640m.
Last year the firm wrote to advisers with clients invested in 23 funds offered through Skandia Life, explaining plans to restructure them. However, the firm delayed any restructure on the Invesco Perpetual funds due to Woodford’s departure from the firm.
The firm said in a note to its investors: “The main reason we are creating this new fund is to give investors access to Neil Woodford, who previously managed both the underlying Invesco funds.”
The Skandia Invesco Perpetual High Income fund will be closing on 9 October and will be closed for new business from 10 September 2014.
The note continued: “Our plan to restructure the Skandia Invesco Perpetual High Income fund was initially delayed because of difficulties in replicating some of its assets in a restructured version of the fund.
“It was delayed further in March this year when the fund’s former manager, Neil Woodford, left Invesco Perpetual and established his own asset management business, Woodford Investment Management.
“As you may be aware, there has since been unprecedented demand for access to Neil Woodford, with many previous investors in the Invesco fund(s) following him to his new fund - a trend that we expect to continue for some time.
“We believe that this is an option that will also be welcomed by a large number of Skandia investors. Neil’s exceptional track record with his disciplined value approach has certainly proved his ability over the long term.
“Accordingly, rather than creating a new version of the Skandia Invesco Perpetual High Income Fund as originally planned, we will instead be closing this fund on 9 October 2014 and launching a new fund - the OMW Old Mutual Woodford Equity Income Fund, subject to FCA approval, into which we will be transfer all current holdings in the former fund.”
In June this year, FTAdviser’s sister title Investment Adviser reported that Neil Woodford’s new fund will be added to Skandia’s platform and be included in its WealthSelect model portfolio range.
The fund has been available on the platform from 20 June this year and at that time it was stated further plans would be announced later in the year.
A Skandia spokesperson said: “The Skandia Invesco Perpetual income funds were previously managed by Neil Woodford.
“Following the launch of the Woodford Investment Management Equity Income fund we have decided to transfer assets from the Skandia Invesco Perpetual funds into the OMW Old Mutual Woodford Investment Management fund so that they continue to benefit from the proven investment expertise of Neil Woodford.”
