LF Equity Income Fund
Settlement Scheme

LF Equity Income Fund Settlement Scheme

Welcome to the website for the LF Equity Income Fund (formerly the LF Woodford Equity Income Fund – ‘the WEIF’) Settlement Scheme (the Scheme). The Scheme will create a Settlement Fund of up to £230 million, that will be used to make payments to relevant investors that hold shares in the WEIF. ‘Relevant investors’ are referred to as ‘Scheme Creditors’ in the Scheme Rules.

The site will be updated with relevant announcements and documents as the Scheme progresses.

LFSL is pleased to announce that the Scheme has been approved by the Court (having been approved by the required majority of Scheme Creditors who voted at the meeting of Scheme Creditors held on 13 December 2023).

Scheme Sanction - Important Update as at 9 February 2024

The High Court has handed down a judgment sanctioning (i.e. approving) the Scheme, following the hearing in front of Mr. Justice Richards (the Judge) on 18 and 19 January 2024 (the Sanction Hearing). The Sanction Hearing was held after 93.7% by number, representing 96% by value, of those Scheme Creditors who voted at the Scheme Meeting on 13 December 2023 voted in favour of the Scheme. 

A copy of the judgment and the transcript from the Sanction Hearing is available here. Once finalised, a copy of the Sanction Order will also be made available on the Scheme website.

Scheme Creditors do not need to take any action. 

Provided that no appeals are brought against the sanction of the Scheme, the Scheme is expected to become fully effective by 2 March 2024.  Payments are then expected to be made to the WEIF from April 2024 for onward payment to Scheme Creditors. However, any appeal to the sanction of the Scheme would be likely to delay payments to Scheme Creditors by at least several months.

The Scheme will affect all Scheme Creditors, regardless of whether they voted for the Scheme or not. They will receive payments in the same way as they have received capital distribution payments in the past.

Further details are available here

What does the LF Equity Income Fund Settlement Scheme do?

The Scheme will settle any claims that relevant investors may have against Link Fund Solutions Limited (LFSL), in return for a payment out of the Settlement Fund. LFSL is the authorised corporate director of the WEIF.

There is a film available on this site to help you understand what is a Scheme of Arrangement. You can watch it here.

LFSL believes the Scheme is the best outcome for investors. The Scheme provides for the maximum amount possible to be paid from LFSL as all of LFSL’s available assets will be put into the Settlement Fund. There will also be a material voluntary contribution from LFSL’s ultimate parent Link Administration Holdings Limited (Link Group) that will not be made if the Scheme does not become effective. If the Scheme is not approved, investors are not guaranteed to receive anything at all and it could be many years before any dispute is resolved.

The FCA has stated that, if approved: “the Scheme offers investors substantially more than is otherwise available from LFSL alone and more than would be achieved by any other means, given the contribution by Link Group.” 

To read the full FCA announcement on the Scheme from 19th April 2023, please see here.

Investors’ Committee and Investor Advocate

To help ensure that the Scheme is fair to all investors, an Investors’ Committee was established to act independently of LFSL and to represent the interests and views of those investors affected. The Chairman of the Investors’ Committee, Jamie Drummond Smith, provided a report on the views of the Committee in respect of the Scheme on 5 October 2023, which can be found here. Watch Jamie discussing the Scheme and the Committee’s conclusion that it offers a better outcome than the alternatives and that the Committee supports it here.

LFSL has also appointed Joe Bannister as an independent Investor Advocate. His role is to help investors by answering any general questions that they may have about the Scheme and also take their feedback on the Scheme and discuss it with LFSL. Joe is an experienced lawyer.

To contact the Investor Advocate with comments and questions please email josephbannisterIA@dacbeachcroft.com.  Please note that he cannot answer questions about someone’s individual investments.

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