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Woodford hit by collapse of Sphere Medical as funding dries up By Daniel Grote 26 Sep, 2019 3 Comments Embattled fund manager Neil Woodford has been hit by the collapse of Sphere Medical, his first-ever investment in the Woodford Patient Capital (WPCT) investment trust, less than three months after he provided fresh funding to the business. The troubled diagnostics firm appointed KPMG as administrators on Tuesday after running out of funding. Woodford has ploughed an estimated £17 million into the business since first investing in 2015 at the launch of his Patient Capital investment trust. The stock is also held in his suspended Woodford Equity Income fund, though the position is negligible and was valued at just £25,000 at the end of June. ADVERTISING inRead invented by Teads Woodford Patient Capital and the Omnis Income & Growth fund Woodford ran for financial advice group Openwork have provided the most recent sources of funding for the business. Both funds supported a £5 million fundraise by the business in 2017, when Sphere warned it needed an immediate cash injection in order to survive. Patient Capital invested £3 million and the Omnis fund £1 million as Sphere delisted from the Alternative Investment Market, saying the move would allow Woodford to invest more in the business by removing 'fund restrictions for public market investments'. The trust shouldered £3.2 million of a £4 million cash call the following year, with Omnis Income & Growth funding the remainder. Woodford provided fresh funding as recently as July this year, as Sphere raised a further £1 million, having backed a £2 million cash call in March. KPMG partner Steve Absolom has been appointed joint administrator of the business alongside Will Wright. 'Sphere Medical has developed an innovative biosensor technology, but unfortunately, has run out of the funding required to enable the technology to achieve the necessary regulatory approvals for it to be commercially developed,' he said. 'An opportunity now exists for a new investor or partner to come forward and harness the potential of Proxima, as we put the technology and associated assets up for sale.' Sphere Medical's collapse highlights the precarious position for early stage companies that had relied on funding from Woodford as their principal backer. Link Fund Solutions, administrator of Woodford Patient Capital, this morning announced it was writing down the value of three of the trust's holdings to 'reflect the challenging fundraising environment for these businesses which may impact their ability to, or the level at which, they may be able to raise capital in the near-term'. Funding for these businesses had come from Woodford Equity Income, which amassed heavy holdings in unquoted companies, early stage company-focused Woodford Patient Capital and the smaller Omnis Income & Growth fund. But all three sources of cash have now largely dried up. Woodford is selling out of hard-to-trade smaller stocks and seeking to offload unquoted companies from his flagship fund as he seeks to secure the lifting of its suspension in December. Northern Trust, the bank providing the lending facility for Patient Capital, meanwhile has the power of veto over any further investments while the level of borrowing is reduced. Woodford lost the mandate to run the Omnis Income & Growth fund in the immediate aftermath of the suspension of Woodford Equity Income, with the running of the fund passed to Jupiter in July.
News on site link below it has gone into administration but article did not copy properly .
Have they got the trace of Money flow, either sender or receiver can request their banks to trace the fund flow they will know where it's stuck
They won't be selling it cheap. More liekly they won't sell it at all. The sale doesn't make a lot of sense to me; profitable division. Why sell it for £160m? Why buy it for £160m when you can buy the whole company for somewhere around £300m (assuming the share price were to double on news of a bid). I don't think Kier even NEEDS to sell Kier Living. Remember, they're saving over £60m a year through the cancelled dividend. All they need to do is keep making money. Kier is essentially a management company. Their subcontractors do all of the physical work. The Kier staff just do the work-winning, planning and overall management. The entire Kier workforce amounts to an average of around 20 people on each project. All they need to to do is keep on, keeping on. Avoid buying any more companies. Avoid getting involved in any loss-making contracts. This company will make its way back to £2 shortly in my view, probably before year end. I'd like to see a trading update in a fortnight or so.
If you read the question I said service business been for sale since January. I know when living went on the market. So in all your reading how is the service business sale going
Actually the divisions have been for sale since June, not January. Listen to the analyst briefing on the sale progress. It will be done by the end of the year. The loss btw was mostly on paper, not so very real. All writedowns and future provisions. So your doubts are NOT well founded. I suggest you do a bit of reading.
What’s happened to the high levels of interest Davies reported? Is it to be a management buy out? They’ve been trying to sell the services business since January? Enough to cover the very real loss they just reported - doubt it!
There is no 'restructuring' and no reason for the cabinet office to trouble itself with Kier. All Davies is doing is selling some Kier businesses. The company is solvent, debt is reducing anyway, it has plenty of financing and only draws on about half of its available credit. Nothing to see here. Just the UK's second biggest construction firm continuing to build schools, hospitals, commercial parks, roads etc all over the country. The share price will now recover steadily, maybe with a quick rise when the residential homes business gets sold.
The Chinese have been controlling this share price for a long time. They still are