Investors in the Woodford Patient Capital Trust have been hit by a fresh blow as a company in which the trust has a £67m holding is set to see its valuation cut.
Link Fund Solutions announced today (November 4) it intends to reduce the valuation of IH Holdings International — the trust’s sixth largest holding — in a move expected to impact the trust’s net asset value by approximately 5p per share.
According to data from Hargreaves Lansdown, IH Holdings makes up nearly 10 per cent of the trust.
The company had been devalued due to a “delay in operational progress”, Link stated.
The announcement has caused the trust’s share price to drop 6 per cent from 38p at end of play Friday (November 1) to 35.6p as at this morning.
This is not the first time IH Holdings has caused investors in the trust to face a reduction in their investment. In August, the trust’s shares also fell 6 per cent over a revaluation of the firm.
Link also announced today an upward revaluation to one of the trust’s holdings, set to increase the trust’s NAV by 0.7p per share, but did not name the holding.
However the announcement stated the business in question had previously been written down in September due to a “challenging fundraising environment” but had since secured funding, leading to a revaluation.
In September it was reported Benevolent AI — a tech firm run by former government minister Joanna Shields — was to receive an investment from Temasek, but one which halved the company’s valuation. The revaluation impacted Patient Capital’s NAV by 4p per share.
Today’s combined revaluations of IH Holdings and the unnamed firm mean the net effect is that the trust’s NAV will reduce by approximately 4.3p per share.
Over the past year the trust has underperformed against its sector, losing 58 per cent compared with the average loss of 31 per cent. The performance over the past three years tells a similar tale.
Patient Capital also suffered recently after Neil Woodford’s decision to shut his company caused its share price to collapse by about 13 per cent. The share price tanked to 29.9p on October 16 — the day after Mr Woodford’s announcement — but had bounced back to 35p at the end of last week.
Mr Woodford announced he would close Woodford Investment Management of October 15 after he was fired from his flagship Equity Income fund and had walked away from both his other investment vehicles — the Income Focus fund and the Patient Capital Trust.
Mr Woodford is still managing the Patient Capital Trust as he works out his notice while Link secures a new manager.
imogen.tew@ft.com
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