Sale of Norton Folgate
16 March 2009
General Capital Group Plc (AIM: GENC), the asset and property finance specialist, today announces that it has completed the sale of Norton Folgate FG plc ("Norton Folgate") to Stable Capital Partners Limited, a company controlled by the management of Norton Folgate.
The business of Norton Folgate, namely finance broking, has been seriously affected by the credit crunch and despite attempts to reduce staff and other cost levels to match consistently diminishing business volumes and turnover levels, Norton Folgate has continued to report trading and cash losses. The management of both Norton Folgate and the Group were unable to devise a future strategy which was sufficiently robust to stem the losses and the continuing drain on the Group's cash flows.
Accordingly, the Board determined that the prospects for a short term return to profitability were low and that the Group should seek to minimise its future losses through a disposal. Consideration for the transaction comprises assignment to the Group of £125,000 of outstanding receivables in the Norton Folgate debtors book and a cash payment of £1,555 for the whole of the issued share capital of Norton Folgate. The Group is also writing off the net inter-company balance owed by Norton Folgate to General Capital of £34,000.
The unaudited management accounts for the 12 month period ended 31 December 2008 show that Norton Folgate had a turnover of £686,000 (of which £195,000 was intra group) and it made a loss before tax of £164,000. Unaudited net liabilities of Norton Folgate as at 31 December 2008 were £228,000.
For further information:
| General Capital Group Plc |
|
| Steve Hartley, Chief Executive | Tel: +44 (0) 1603 610 610 |
| steve.hartley@generalcapital.co.uk | www.generalcapital.co.uk |
| Collins Stewart Europe Ltd | |
| Hugh Field / Adam Cowen | Tel: +44 (0) 20 7523 8350 |
| www.collins-stewart.com |
Media Enquiries:
| Abchurch Communications | Tel: +44 (0) 20 7398 7700 |
| Heather Salmond / George Parker / Jack Ballantyne | Tel: +44 (0) 20 7398 7719 |