BETTER Capital, the private equity firm run by veteran investor John Moulton, is in rescue talks to salvage the coal mining operations of ATH Resources.
Doncaster-based ATH, which operates all four of its open cast pits in Scotland, fell into administration on Wednesday night, although its subsidiary, Aardvark TMC, continues to trade.
But Better Capital yesterday revealed that it is in talks with all the company’s “stakeholders” – including customers, local councils and staff – to find a way to keep Aardvark trading.
Shares in the Aim-quoted miner, which has about 330 staff, were suspended on Wednesday afternoon, just hours before Brian Green, Allan Graham and Will Wright from “big four” accountancy firm KPMG were appointed as joint administrators.
A spokesman for Better Capital told The Scotsman: “Talks are ongoing with all the stakeholders involved. Better Capital has indicated a willingness to invest in the survival of the business.
“The administration is part of the process of securing a future for the company.
“Genuinely, Better Capital never asset strips. Better Capital is all about investing in companies and making good companies. We’re very keen that every-one comes to the table – everyone will need to compromise and, if we can make it work, then there will be a good ongoing business that’s properly capitalised that preserves the jobs.”
He said other stakeholders involved in the talks include the coal authority, land owners and the Scottish Environment Protection Agency (Sepa).
KPMG’s Wright added: “Our appointment only affects the group’s parent company and the main trading businesses within the group are unaffected by our appointment.
“They continue to trade as normal under the control of their directors. We are now looking at all the options, including a sale of the business, working with the directors and the other key stakeholders to try and find a solution that sees trading of the parent company continue.”
ATH, which has debts of around £22 million, had warned shareholders last month that the value of their holdings may be wiped out in a restructuring of the firm.
The group’s market value has plunged in recent years, from a high of more than £110m in 2007 to less than £150,000 before its shares were suspended.
In October, its future was thrown into doubt after it called in accountancy firm Deloitte to look at options including restructuring or a sale of the business, which is led by chief executive Alistair Black.
Better Capital bought some of the company’s bank debt and last week ATH said that it had hired KPMG to look at selling its assets.
Major shareholders in the company included Swedish value investor Peter Gyllenhammar. He was the largest investor in the company, with a 20 per cent stake, while businessman William Paterson of Coatbridge-based group Patersons Quarries was also a major shareholder, with a holding of 8.52 per cent.
Last year, the company entered takeover talks with an unnamed buyer that were eventually aborted. Energy and logistics group Hargreaves Services had been tipped as a likely suitor.
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Weather for Edinburgh
Saturday 18 May 2013
Temperature: 9 C to 13 C
Wind Speed: 18 mph
Wind direction: North east
Temperature: 9 C to 18 C
Wind Speed: 8 mph
Wind direction: North east