Link Group is in exclusive negotiations with Waystone Group about selling its UK-based Link Funds Solutions business, which was the corporate director to the collapsed Woodford Equity Income Fund.
The deal could see Waystone Group buy LFS minus Woodford-related liabilities.
Australia-based Link Group also said it is in talks with the UK’s Financial Conduct Authority (FCA) about the investigation into LFS following the Woodford collapse.
Waystone, while confirming the ongoing negotiations, said any transaction would be subject to the successful finalisation of “due diligence, detailed legal agreements, board and other approvals”.
Following the announcement by Link Group, the FCA said it was in “advanced confidential discussions with Link group and LFS to determine whether the FCA’s proposed enforcement action against LFS can be resolved by agreement”.
The suspension of Woodford Equity Income Fund in June 2019 saw steep investor losses before the fund was closed in October of the same year.
In September 2022, the FCA released a draft warning notice summarising the potential of a £50 million fine and redress payments of over £300 million. It is these payments that Link Group will be negotiating with the regulator.
The UK financial regulator said its focus is to ensure that investors affected by the suspension of the Woodford Equity Income Fund “obtain redress”.
If the deal with Waystone and negotiations with FCA concludes, Link Group will not receive net proceeds from selling its fund solution business.
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