Eatonfield chief uses stake as security
THE chief executive of struggling property developer Eatonfield Group has used his entire stake in the company as collateral.
Rob Lloyd has pledged 11,000,000 ordinary shares – totaling 47.7% of the Mold, Flintshire-based company – as security against personal borrowings.
Mr Lloyd, who founded Eatonfield in 1998 after running the Manchester operation of developer UK Land, remains the beneficial owner and retains the voting rights.
The disclosure came ahead of tomorrow’s Financial Services Authority deadline for directors to disclose personal loans taken out against shares in the their own companies.
The requirement was introduced following the confusion that led David Ross – founder of Carphone Warehouse and an investor in Manchester stockbroker WH Ireland – to resign from the boards of three companies after failing to disclose loans pledged against shares.
In addition, Eatonfield has been given a further loan of £400,000 by Rob Lloyd Racing, a racing yard in Cheshire that is owned Mr Lloyd.
The loan will meet a short-term working capital funding requirement, the AIM-listed company said in a statement to the stock market.
The loan is unsecured and free of interest and fees – unlike the £750,000 loan agreed between the two parties in October.
This had interest of 1.25% a month, gave Rob Lloyd Racing a profit share on a development in Cumbria and another in Scotland, and paid an additional £95,000 for guaranteeing the group’s £1m extended overdraft.
The latest loan is repayable on demand until February 27, 2009 and revised terms will be negotiated if Eatonfield needs the facility beyond this date.
In November, the company announced it had made a pre-tax profit of £4.03m, down 12% on the previous year. Since September shares in the group have crashed from 67p. They were at 5p when the market closed on Wednesday.
