Net Asset Value(s)

RNS Number : 1644J

Mineral & Financial Invest. Limited

12 July 2013

 



MINERAL & FINANCIAL LIMITED

("Mineral & Financial", "MAFL", or the "Company")

NET ASSET VALUE UPDATE

·    8.26p per share NAV as of 30 June 2013

·    £490,000 cash

·    Strategic restructure by new Management of legacy portfolio near complete

·    Loan of £330,000 written down to £40,000 following the suspension of trading in shares in Silvermere Energy plc ("Silvermere") on AIM

Post period

·    MAFL as a major Silvermere creditor is actively engaged in process to secure future value from its investment in Silvermere

·    Board strategies to develop value from MAFL now legacy issues near conclusion

·    £270,000 cash realised from two post period transactions

·    Total unaudited current cash position £760,000

The Board of Mineral & Financial announces that the Net Asset Value of the Company as at 30^th June 2013 was 8.26p per share. Cash balances stood at £490,000 as of period end with further funds realised from two post period transactions.

Silvermere Energy

Allowing for the share consolidation that was completed on April 17th, this represents an expected decline from the previous NAV of 13p (0.13p) due to the Board's decision to write off 88% of the book value of the Company's outstanding £330,000 loan (total £660,000 with coupon arranged in 2011) to Silvermere.

The Company has taken this decision following the suspension of trading in Silvermere shares on AIM. Since the Board of Mineral & Financial were informed by the directors of Silvermere of the oil and gas company's funding issues in April 2013 and as the major creditor, the Board has engaged in an aggressive process to secure future value for the asset.

A process to recover the Silvermere vehicle with new investors and which includes an ongoing equity involvement for Mineral and Financial is currently progressing. It is expected that significant developments will be announced to Mineral & Financial Shareholders during Q3 2013.

Equity Investments

While the Company's investment portfolio was adversely affected by poor market conditions in the mining and commodities sector the Board anticipated this to some extent, and has maintained a significant portion of the portfolio in cash.

Mineral & Financial is now undertaking a strategic review regarding corporate development and creating value for shareholders. Although opportunities in the depressed equities market for commodities stocks are clearly available, the serious nature of lack of funding for resources companies means that underlying asset value has to be taken in consideration, as does ability to secure funding over the next 24 months. A key component of looking at ongoing investments is to develop a dialogue with project finance providers to assess development viability for assets.

Post period

The Company has completed two transactions which have brought a further £270,000 of cash onto the balance sheet.

The first was the sale of further units in the SF Webb Capital Smaller Companies Growth Fund, as agreed under a schedule laid out at the end of the third quarter of 2012. Some of the proceeds of this sale have been used to pay down outstanding debt, but the rest have been retained.

The second was the conversion into shares of the Company's loan to Chapel Down, and the subsequent sale of those shares, as part of a recent fundraising undertaken by Chapel Down. The Company is pleased to report it has cleared a profit of approximately £45,000 on this deal.

The Company's total unaudited cash position as at 11^th July therefore stood at approximately £760,000.

Commenting today Alastair Ford, Chief Investment Officer, said: "Today's NAV announcement accurately reflects the current position of Mineral & Financial following just under 12 months of working through a series of legacy positions and loans. We have realised cash from a number of investments and shone light on significant issues with others, in particular the Silvermere loan. As regards Silvermere, the Board has taken a very proactive stance with positioning the Company to derive future value from this 2011 instrument but has written value down now as an accurate current reflection of the portfolio. We are now looking to develop Mineral & Financial and carefully considering how best to leverage shareholder value effectively in a structured manner." 

For further information please call:

Mineral & Financial Limited

Jennifer Allsop [phone]

Libertas Capital Corporate Finance Limited

Sandy Jamieson [phone]

 

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