Eddie Stobart frozen in blow for Woodford

EMBATTLED neil Woodford has suffered another blow as Eddie Stobart ousted its boss and suspended share trading due to a multi-million pound black hole in its accounts.

The stock-picker owns 23pc of the haulage group and is stuck in the business while it determines the extent of the problem.

In a terse update to investors, the company announced chief executive Alex laffey would be leaving immediately.

Stobart first revealed an accounting problem six weeks ago when it said the black hole appeared to be £2m.

But after reviewing historic results, it has conceded that the situation is significantly worse than this.

Its shares are suspended, meaning Woodford and other investors will not be able to buy or sell any of them, and bosses admitted it will not be able to file its half-year accounts by a cut-off date this month. Stobart’s stock has plunged 30.4pc since the beginning of the year, wiping around £120m off the value of Woodford’s stake.

Woodford was forced to freeze withdrawals from his flagship Equity Income fund in June after he ran out of ready cash to pay back investors who were fleeing for the exit.

Stobart – which is separate to Stobart Group, another Woodford-backed stock, which owns london Southend airport – also said that it will review its dividend policy, which saw shareholders awarded 6.3p per share last year. The departure of 58year-old laffey follows the appointment of Anoop Kang, as chief financial officer at Eddie Stobart in April.

Kang conducted a review into the company’s accounts, and found that several of its trucking and logistics contracts had been overstated.