Ian Cowie: a decade of disappointment, but I’ll hang on

Our columnist explains why he won’t be taking up the opportunity to sell some of his shares in the poor-performing investment trust formerly managed by Neil Woodford.

17th July 2025 11:56

Ian Cowie from interactive investor

Happy endings are popular in fiction because there are so few of them in real life - and the same is true for corporate start-ups selling tales of jam tomorrow. Most of them go bust, leaving investors who had dreamed about the sweet smell of success with the bitter taste of failure.

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Next Tuesday, 22 July, is the deadline for long-suffering shareholders in Schroders Capital Global Innov Trust Ord (LSE:INOV) to decide whether to throw in the towel after a decade of disappointment. Bear in mind this was the biggest investment trust launch ever when it raised £800 million in 2015, setting out to commercialise scientific research by UK universities and smaller companies backing British new technology.

Sounds familiar? Chancellor Rachel Reeves was at it again this week in her Mansion House speech when she bemoaned Britons’ mystifying reluctance to invest pension funds or other savings in our high-tax, low growth economy.

Reeves declared: “For too long, we have presented investment in too negative a light, quick to warn people of the risks without giving proper weight to the benefits.”

Sad to say, I missed the bit where she explained why the Parliamentary pension fund has less than 4% of its money invested in Britain or told us which shares she’s bought. So, I will tell you about one of mine.

Back in 2015, I invested 1% of my life savings in the investment trust that was then called Woodford Patient Capital, paying £1 per share. The so-called star fund manager, Neil Woodford, has long since departed and the shares currently trade at 16p. Schroders took over the investment trust in December 2019.

Please don’t laugh, but this expensive experience has confirmed my worst suspicions about those in the industry who used to praise “good old Woody” but can barely bring themselves to mouth his name today.

Here and now, INOV investors must decide whether to accept the tender offer and sell up at an indicative 21p per share. That’s a third more than the current market price but, depending on demand, might only apply to a fifth of each investor’s shares.

Many brokers and wealth managers are usually happy to offer unsolicited opinions but very few can bring themselves to talk about INOV now. No wonder cynics say success has a hundred fathers but failure is a foundling.

So congratulations to Shavar Halberstadt, analyst at Winterflood Research, who pointed out: “The first INOV tender offer may provide a degree of relief to those shareholders that had been looking for an exit at net asset value (NAV).

“The £37 million available for distribution is higher than previous guidance of £30 million, which is testament to the skill of the Schroders management team, as it reflects the outsize multiple on cost achieved in the realisation of Araris Biotech.”

Other interesting ongoing assets at INOV include Atom Bank, the Durham-based institution that was Britain’s first digital-only mobile phone bank to gain authorisation. Similarly, there is Revolut, another fintech company set up by the British-Russian businessman Nikolay Storonsky and the British-Ukrainian software engineer Vlad Yatsenko. Given unhappy events elsewhere, that’s an encouraging combination. Another top 10 holding is AgroStar, an Indian “agrotech” business aiming to increase farmers’ harvests and profits.

Halberstadt added: “Further tenders are expected to take some time amid a slow exit environment, but we would not preclude the possibility that at least the Schroders-selected assets are disposed of within a reasonable time frame.”

Tim Edwards, chair of INOV who joined the board in 2021, explained: “We expect realisations to be achieved via a combination of trade sales and initial public offerings (IPOs). Based on our latest estimates and prevailing market conditions, we do not expect to start meaningful realisations until the 2026-27 period.”

That’s why I don’t intend to accept the tender offer next week. Having waited a decade for INOV’s tales of jam tomorrow to turn into something of value today, I’m in no rush to turn paper losses into real ones. It is still just about possible that a gem might be uncovered.

More positively, seeing INOV throbbing in red at the bottom of my portfolio might inoculate this investor against similar rushes of blood to the head in future.

Ian Cowie is a freelance contributor and not a direct employee of interactive investor.

Ian Cowie is a shareholder in Schroders Capital Global Innovation (INOV) as part of a globally diversified portfolio of investment trusts and other shares.

These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

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