6th Feb 2017 09:13
LONDON (Alliance News) - Challenger Acquisitions Ltd on Monday said it has implemented a series of cost-control measures following its announcement last week it had sold engineering firm Starneth only two years after agreeing to buy it.
"Following the recent disposal of the Starneth business, we believe it is prudent to minimise our public company costs until fees from the closing of Giant Observation Wheel projects commence. In line with this, we are currently exploring a number of prospective growth opportunities, and we look forward to updating shareholders on these developments in due course," said Mark Gustafson, Challenger's chief executive.
Challenger, which designs and builds giant observation wheels, bought Starneth in 2015, and was originally due to make a first payment of EUR1.25 million to Starneth's vendors last July. That deadline was then extended after delays on Challenger's observation wheel project in Jakarta.
On Monday, Challenger said Gustafson has agreed to cut his salary to GBP1,000 per month until further notice and the board of the business has been reduced to three members, with Markus Kameisis stepping down as an executive director. Kameisis will remain chief financial officer.
In addition, Challenger said it has issued 8.3 million shares to convert GBP630,431 of its 2017 convertible note agreement and GBP50,000 of its 2018 loan notes. The shares for the 2017 notes were converted at 8.20 pence per share, while the 2018 conversion was done at 7.80p per share.
Challenger shares were down 4.6% to 7.51 pence on Monday.
By Sam Unsted; [email protected]; @SamUAtAlliance
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