(Bloomberg) --
M&G Plc's flagship property fund will remain closed to withdrawals indefinitely, after it was frozen last month amid heavy outflows.
The 2.5 billion-pound ($3.3 billion) M&G Property Portfolio fund is in the process of selling about 140 million pounds worth of assets, the manager said in a statement Thursday. The fund has already sold or exchanged contracts on properties valued at about 70 million pounds and is in advanced stages of a further 67 million pounds of deals.
“The immediate priority is to raise cash levels in a controlled manner,” the firm said in the statement. The fund's administrator “will formally report on the status of the suspension on a monthly basis and clients and customers will be notified in advance of reopening the fund.”
The asset management industry is being buffeted by investor fears about daily-dealing funds that allow quick entry and exit but hold assets that can take weeks or months to sell. M&G's fund freeze was one of several shocks in 2019 that included the demise of stock picker Neil Woodford's investment business.
Property funds have been grappling with a crisis gripping the U.K. retail sector, as well as political uncertainty as the country prepares to leave the European Union. Among the properties that the fund has sold was a retail property in London's northern suburbs.
Read More: M&G Freeze Shows Winter Is Here for U.K. Malls, And Staying
To contact the reporters on this story: Lucca de Paoli in London at gdepaoli1@bloomberg.net;Jack Sidders in London at jsidders@bloomberg.net
To contact the editors responsible for this story: Shelley Robinson at ssmith118@bloomberg.net, Patrick Henry
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