Woodford Patient Capital to cut gearing; ex-Mercury Cohen appointed to board

Among a number of measures in response to shareholders

The board of Woodford Patient Capital has announced a number of measures as a response to the ongoing crisis at Woodford Investment Management, including a radical cut to the gearing level and the appointment of ex-Mercury's Stephen Cohen to the risk and valuation committee.

The board plans to reduce gearing from the current level of around 16.8% to below 10% within six months and to "be generally operating ungeared" within 12 months.  After this period, the board wants the trust to continue operating at a lower gearing level to offer more capital flexibility; the manager would have to seek approval from the board should he wish to borrow more than 10%. Currently, the trust is allowed to borrow up to 20% and is utilising £126m of the total £150m borrowing facility available to it.  At the same time, the trust plans to undertake share repurchases if the di...