Moulton fund investors windfall after sale of debt

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VENTURE capitalist Jon Moulton’s investment vehicle is to return £12.4 million to shareholders following the sale of coal miner ATH Resource’s debt.

Better Capital said investors would receive 6p a share on 19 April. The payment marks the second distribution from the firm’s 2009 cell, following a payment of 6.8p earlier this month.

The 2009 cell is a “feeder fund” that invests its proceeds in Better Capital’s Becap fund, which spent £15m buying up ATH’s debt. The Aim-quoted holding company for the miner – which is based in Doncaster but has all five of its open-cast mines in Scotland – was placed in administration last year.

Better Capital sold the debt, which was secured over the assets of ATH’s operating subsidiary, Aardvark, to coal producer Hargreaves Services for £5m at the start of this month.

The private equity firm was thought to be seeking to buy the miner outright, but was unable to agree a deal amid complex negotiations with customers, land owners and the Scottish Environment Protection Agency.

Hargreaves, owner of the mothballed Maltby deep mine near Rotherham, has vowed to help safeguard jobs at ATH by leading a restructuring at Aardvark “that allows viable sites to continue to operate”.

The firm also owns the Monckton coke works near Barnsley and was tipped as a potential suitor for ATH in 2011, when the miner said it was in talks over a possible offer for the company.

At the time of the deal, Hargreaves chief executive Gordon Banham said the firm wanted to become a key player in the Scottish mining industry.