The implosion of City investment fun manager Neil Woodford’s Equity Fund has prompted highly unusual share trading in Purplebricks stock as both the fund and the hybrid agency endure troubling times.
Yesterday Woodford once more reduced his holdings in Purplebricks, selling five percent of his stock in the company, taking his holding to 23.9%.
The sell-off raised £16 million for the embattled fund, which was frozen by Woodford on Wednesday as he fought to stop investors cashing out.
The shares appear to have been sold to Martin Hughes’ Toscafund, which has been busy hoovering up Purplebricks shares in recent days.
This is likely to be part of speculative move ahead of a takeover bid by another fund, possibly US investment house Francisco Partners, which is likely to offer above bid price for all the company’s shares.
Toscafund initially bought nearly three million extra Purplebricks shares last week making it the eighth largest holder of the company’s stock with a total holding of 5.64%, before then upping its share to 10.1% yesterday.
In the meantime City watchers have been busy shredding Neil Woodford’s reputation.
Evening Standard columnist Simon English yesterday savaged his investment strategy, saying that: “For at least the past five years you didn’t have to try very hard to find fund managers who thought his investment strategy was a sure route to ruin”.
“His plan to mix holdings in large dividend yield stocks with small unquoted biotechs was esoteric to say the least.”