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LCF administrators hold out promise of profits from North Sea oil investment

JIM ARMITAGE
Andy Buchanan, Getty Images

Bondholders in collapsed London Capital & Finance were today told one of the company’s investments may come good.

The minibond firm went bust early this year after raising £236 million from members of the public. While administrators have been pessimistic about most of the investments LCF made, one, an Aim-listed North Sea oil explorer called Independent Oil & Gas, appears to be working.

In a letter to bondholders, administrator Smith & Williamson raised the prospect of recovering potentially £106 million from the investment, depending on how much it is able to sell its shares for.

S&W said it had been advised that IoG was worth significantly more than its current share price of 17.75p. If it managed to sell its interest at 30p, S&W could recover £83 million before costs, while at 40p it would be £106 million.

However, the administrators added: “Bondholders should be aware, however, that there can be no certainty as to the return, if any, that will ultimately be achieved.”

Andrew Hockey, chief executive of IoG said it had already repaid more than £17.1 million of the £34.6 million it borrowed from the LCF group via its subsidiary London Oil & Gas.