2 October 2013 – update on financing
It is disappointing to note that negotiations with the company’s largest shareholder have stalled and the proposed rights issue now looks highly unlikely. This leaves the company requiring the support of its lending banks and with the breach of covenants a strong possibility this leaves the company in a precarious position. A Chief Restructuring Officer will be appointed to the board by 10 October and the issue of financing is key to the survival of the business in the short to medium term. Although it is important to look at the bigger picture, there appear to be better opportunities elsewhere. The company is now valued at just over £20m so there seems little point in those who are already invested selling out. On balance the shares are now a HOLD.