Neil Woodford’s stock-market-listed fund has announced its first major investment since the shuttering of its flagship sister vehicle last month.
Woodford Patient Capital Trust confirmed on Monday that it was pumping £10m into Atom Bank, keeping its stake at 18%. It is part of a wider £50m fundraising by Atom Bank that also drew investment from the Spanish banking group BBVA and investment funds Perscitus and Toscafund.
But Woodford’s involvement in the funding round failed to excite investors. Instead, shares in the FTSE-250-listed fund fell 1.6% to a new low of 53.1p.
It is the first major investment decision made by Patient Capital since 3 June, when Woodford made the shock decision to suspend his flagship Equity Income Fund after being overwhelmed by customer withdrawals. It followed a string of bad investments that caused the fund’s performance to nosedive. Woodford was forced to block investors from withdrawing their money from the equity income fund in order to give himself time to sell off stakes in quoted stocks and unlisted companies that can be more difficult to sell.
The move trapped more than 290,000 retail clients and their billions of pounds of investments behind the gated fund. The suspension was recently extended by another 28 days to 29 July.
While Woodford Patient Capital Trust is not directly affected by the suspension, the move by its sister fund caused a sell-off in its shares and resulted in closer scrutiny of its investments. Its shares have tumbled 32% since the Equity Income Fund was gated.
Woodford Patient Capital Trust declined to comment on the new investment.
Patient Capital last month followed through on a commitment to hand £20m in funding to Proton Partners, a Hereford-based company focused on cancer treatments using proton beams. However, that funding announcement was originally made in February, before Woodford’s Equity Income Fund was suspended.
Atom Bank said it planned to use its fresh funding to fuel growth and investment in technology. Atom, which offers savings accounts, business loans and mortgages, was founded by the former Metro Bank boss Anthony Thomson in 2014.