Partial collapse at Hadrian’s Wall – on 2 October 2019, Hadrian’s Wall Secured Investments acknowledged that it was experiencing problems with its loans to Biomass Premium Fuels Limited and Biomass Optimum Fuels Limited.
Biomass Premium Fuels has been trying to agree a joint venture or partnership with another party. Unfortunately, after exploring a number of possible options such an arrangement does not currently appear to be possible. Further, Hadrian’s Wall Capital Limited, the investment adviser has advised the board that, as a result of recent and unexpected developments, the partnership between Biomass Optimum Fuels and SDL that was announced in October is unlikely be sustained beyond the near term.
Consequently the adviser expects that the company will incur a material loss on these investments. The board has taken the decision to provision for a total loss on both loans and accordingly has increased the loss reserves against these assets from GBP3.2 million in aggregate to GBP18.1 million in aggregate. The investment adviser continues to explore options for both companies and recovery from the related assets and further updates will be provided in due course.
[This news puts a significant dent in Hadrian’s Wall’s net asset value. At the end of September the net assets were £137m or 95.5p per share. This writedown takes just over 10p off the NAV. Since early May, the share price has been sliding from around NAV to 65.5p last night. We’d expect it to take a further hit today.]
HWSL : Partial collapse at Hadrian’s Wall