Woodford closed-ended fund is oversubscribed

Woodford closed-ended fund is oversubscribed

High demand has led Woodford Investment Management to increase the share capital of its new Patient Capital Trust to the maximum amount of £800m.

“We feel this is in everyone’s interests to do so – the scale of the upsizing is in keeping with the Trust’s investment strategy and will not impact its objective or portfolio construction,” Craig Newman, the investment firm’s chief executive, said.

Initially the prospectus for the trust set the share capital raising at £200m but raised it to £500m.

Mr Newman said: “We are excited by the level of support we are getting from investors and where we can we want to avoid scaling back investors’ applications, which would likely occur if the final interest was greater than £500m. This is why the Trust’s Board has decided to publish a supplementary prospectus.”

He said Mr Woodford and his team were comfortable managing the investment strategy of the fund and deploying the eventual initial capital raised in line with the time frame set out at launch.

“We have an attractive pipeline of investments in the wings and we are relishing the greater flexibility that this level of interest affords – giving us the opportunity to work closely with early-stage businesses and helping more of them achieve commercial success,” he said.

Launched in May 2014, Woodford Investment Management already has more than £9.3bn assets under management and advice, with £5.06bn of this is in his CF Woodford Equity Income Fund.

The Patient Capital Trust opened for subscriptions in February with the aim to invest in a diversified portfolio predominantly of UK companies, both quoted and unquoted.

If the trust raises £800m it will make the company the fortieth biggest investment trust in the UK and earn it a place in the FTSE 250.

The offer closes on 17 April and trading begins on 21 April.

Adviser View

Mark Dampier, head of investment research at Bristol-based Hargreaves Lansdown, said: “It shows the strength of the Woodford brand and the interest in this long-term investment opportunity. It should mean investors will benefit from a better allocation and potentially receive everything they apply for. An additional £300m does not change the fundamental long-term nature of this investment.”