Job cuts planned at troubled Woodford investment firm
The firm of well-known fund manager Neil Woodford is planning redundancies after investors pulled billions of pounds from his flagship fund.
The cuts are expected to affect a small number of support staff, rather than staff managing investments.
Woodford Investment Management employs around 45 people.
Despite the suspension of the flagship fund and the job cuts, the firm continues to charge £65,000 per day in management fees.
The suspension of the Woodford Equity Income Fund in June caused an outcry among investors.
Mr Woodford suspended the fund last because it could not meet requests from investors to withdraw their money.
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Link Fund Solutions, which administers the fund, said this week that Woodford's flagship would remain suspended, without giving a reopening date.
The firm is selling the fund's less liquid and unlisted assets, which cannot quickly be turned into cash, in favour of more liquid stocks, so that it can reopen.
Mr Woodford has faced criticism from investors, regulators and MPs for continuing to charge fees while the fund is suspended.
The fund's £65,000 a day management fee "covers a wide range of costs associated with running an actively managed fund," the firm said in a bulletin for financial advisers.
"This includes the cost of fund management and also covers the costs of infrastructure and the staff across our entire business who are involved in running the fund."
In the days following the equity income fund suspension, the firm lost the right to manage nearly £4bn.
"We have reluctantly entered into redundancy consultations with a number of staff to advise them that their roles are at risk," a spokesman for the firm said.
The firm manages a second, smaller open-ended fund, the income focus fund, as well as the listed Woodford Patient Capital Trust (WPCT).
The income focus fund, which does not invest in unlisted firms, has seen assets under management drop by nearly 40% to £295m since the suspension of the main fund, according to Morningstar data.
WPCT shares have dropped by more than 25% since the flagship fund suspension, though they were up 3.4% on Wednesday.