Cash shell Concha has completely written off two of its investments valued at £1.53m.
This is behind the £1.85m loss reported for the year to June 2013.
Concha owned 40% of Moshen, a developer of digital apps for sports and entertainment, which it acquired last April. There was also a loan. In the summer, Moshen’s chief executive was suspended due to financial irregularities. An administrator was subsequently appointed and it informed Concha that its security over the Moshen assets was invalid. Concha is suing its legal advisers for negligence and “failure to validly register a security interest associated with the loans in a timely manner”. A total of £720,000 was written off.
Churchill Media was Concha’s first investment as a shell but it has failed to repay the loan facility provided by the Aim company. This investment was secured against Churchill’s investments but it has not been repaid on the repayment date of 30 September. Including interest, this loan was valued at £810,000.
Concha may still be able to secure some cash from these investments but it is not certain this will be the case.
There was £86,000 in the bank at the end of June 2013. Since then, £639,000 has been raised at 0.35p a share. At the end of December, after the bad news about the investments, a further £100,000 has been raised at 0.2p a share. There was also a put and call option over an additional 50m shares exercisable by 14 February.
Concha spent £400,000 on a 30% stake in The Works, a media design agency.
NAV was £142,000 at the end of June 2013. The pro forma NAV is £881,000. At 0.2p a share, Concha is valued at £1.65m.
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