Woodford suffers third hit as AA dives on CEO sacking

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Woodford suffers third hit as AA dives on CEO sacking

Neil Woodford is among the investors who has suffered a serious loss today (1 August) with the shares of accident recovery firm AA falling 14 per cent in the wake of executive chairman Bob McKenzie being removed from office.

In a statement released to the stock exchange, the AA said that McKenzie has been removed for “gross misconduct.”

Woodford Investment Management is the largest institutional shareholder in the company, according to Financial Times data, holding a total of 73.23m shares, or 12.01 per cent of the total in the market.

It is the 32nd largest holding in the £9.8bn CF Woodford Equity Income fund, equivalent to 0.9 per cent of the fund, or £88.2m.

AA shares have fallen sharply in the wake of today's shock news, dropping from £2.43 when the market opened this morning, to the current level of £2.08p.

This is the third significant blow to shares that are significant holdings in Neil Woodford funds in the space of a little over a week.

Last week saw steep share price declines for FTSE 100 pharmaceutical giant AstraZeneca and doorstep lender Provident Financial, both large holdings for Mr Woodford.

Provident Financial shares feel steeply in light of a 45 per cent drop in profits. AstraZeneca shares dropped 16 per cent as a consequence of the failure of a much anticipated cancer trial.  

Woodford Investment Management declined to comment on the investment case for AA shares in light of today’s news.  

The £9.8bn CF Woodford Equity Income fund has returned 5.8 per cent over the past year, compared with 13 per cent for the average fund in the IA UK Equity Income sector in the same time period.