Neil Woodford is staging a bold comeback bid nearly a year-and-a-half after shutting his investment company, leaving thousands of investors trapped and out of pocket.
In an interview with The Sunday Telegraph, he said: “I didn’t want what happened to me in 2019 to be the epitaph of my career, I didn’t want it to be the full stop.”
The phrase “what happened to me”, however, is likely one that will anger investors; as it suggests that Woodford also views himself as a victim of the collapse of Woodford Investment Management.
He said that he was “sorry” for what he did wrong but said that claims his leadership caused Woodford Equity Income Fund to fail were unfounded.
“I didn’t make the decision to suspend the fund, I didn’t make the decision to liquidate the fund. As history will now show, those decisions were incredibly damaging to investors and they were not mine,” he told The Telegraph.
Long memories
His latest venture is called Woodford Capital Management (WCM) Partners and is based in Jersey and Buckinghamshire.
Ryan Hughes, head of active portfolios at AJ Bell, commented: “The potential new investment vehicle looks like it will be aimed at professional investors only with the investment approach once again focused on niche, higher risk, potentially illiquid investments that Woodford had such conviction in for his previous fund.
“While he may be right that there are some great companies to invest in, his track record showed that it is very hard to identify them and many need years of funding before they become successful, with plenty falling by the wayside along the way.”
Hughes says it appears as though “Woodford is looking for vindication that his original investment strategy was correct all along”.
“While he has acknowledged that a fund for retail investors would look very different today to the one he previously ran; by focusing on professional investors, he clearly hopes that much of the emotion and fury that he has faced over the past two years will disappear.
“However, given the broader damage in trust and confidence that this whole affair has caused to the investment industry, it looks unlikely that investors of any kind will find it so easy to forget.”
In October 2020, it was announced that investors could be waiting another year to get their money back.
A campaign was launched by Evidence-Based Investor in November 2020 on behalf of Woodford Equity Income investors seeking redress for the fund’ failures.
Fund collapse
After 26 years at Invesco Perpetual, Neil Woodford set out on his own in 2014.
At its peak in 2017, his company managed £10.2bn ($14.1bn, €11.7bn).
In June 2019, his flagship LF Woodford Equity Income Fund was gated following a flurry of redemptions after a series of risky investments turned sour.
Five bruising months later the decision was taken to wind up the company.
Long-term investors lost about 25% and approximately £200m is yet to be returned.
At the time, Woodford described the decision to close as “highly painful”.
“I personally deeply regret the impact events have had on individuals who placed their faith in Woodford Investment Management and invested in our funds.”
