16th Aug 2019 18:00
(Alliance News) - Honeycomb Investment Trust PLC and P2P Global Investments PLC have ended talks of a GBP1 billion merger amid concerns about the exposure of the combined firm to troubled fund manager Woodford Investment Management, Sky News reported on Friday.
Sky News reported the two firms had been in talks to merge following the lead of the investment manager of both trusts, Pollen Street Capital. The deal was believed to have been structure to be a takeover of Honeycomb by P2P.
Several shareholders in P2P were concerned, however, that they were being asked to overpay for Honeycomb amid the ongoing issues at Woodford Investment Management. Some of the objecting shareholders were reported to be Aberdeen Standard Investments - part of Standard Life Aberdeen - and Premier Asset Management PLC.
Woodford Investment Management is managed by Neil Woodford and holds a 22% stake in Honeycomb. Until May, it had held a 13% stake in P2P.
Since June, Woodford has frozen redemptions from its funds after a run of sales by investors led to a liquidity crunch. Since then, Woodford has been selling holdings worth hundreds of millions of pounds to remove the more illiquid and obscure holdings in its portfolio.
Sky News explained it was unclear whether talks of a potential merger between Honeycomb and P2P would resume.
https://news.sky.com/story/1631bn-finance-merger-falls-prey-to-city-fears-over-woodford-crisis-11786719
Shares in P2P closed 0.2% higher at 842.00 pence in London on Friday, Honeycomb shares were untraded at 1,109.00 pence.