6th Sep 2013 07:32
LONDON (Alliance News) - Concha PLC may get little if any of a GBP300,000 loan it made to insolvent Moshen Ltd back after it said Friday that Moshen's administrators had deemed the loan to be unsecured.
The company said it was taking legal advice to determine for itself the validity of the security it was granted against the loan, and the likelihood of success if it was to challenge the administrator's decision. The administrators say the security is unenforceable, Concha said in a statement.
Concha's investment in Moshen was its first since it became an investment company in media, communications and technology firms, and has proved to be disastrous. It bought a 40% stake in the app developer in April.
The company last month said Moshen Chief Executive Graham Baines had been suspended pending an investigation into financial irregularities at Moshen which had left the developer with a significant working capital shortfall.
A day later Concha said it had called administrators into Moshen to see whether they could recover any value for Moshen's creditors and shareholders.
At that time, it had said it understood that it was Moshen's only secured creditor, having provided it with abouty GBP867,000 in funding, made up of roughly GBP400,000 in equity, and ?GBP467,000 as a secured term loan.
Concha used to own the Hot Tuna surfwear fashion brand, but wound up that business and converted to an investment company
Concha's Chairman Chris Akers is a former media analyst for Saatchi and Saatchi who then moved onto banking and then business. He was chairman and chief executive of football club Leeds United between 1996 and 1998.
The company's shares were down 12.7% at 0.24 pence early Friday.
By Steve McGrath; [email protected]; @SteveMcGrath1
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