Former Inland Homes boss invests £2.5m in troubled housebuilder
Former Inland Homes chief executive Stephen Wicks has agreed to invest £2.5m in the housebuilder as part of a share sale.
Inland Homes, which faces a suspension of share trading next week as it is set to miss the stock-market deadline for publishing its financial results, opened a share subscription offer for up to £4.6m on Wednesday afternoon (29 March).
In a market statement on Thursday (30 March), it said that Wicks, who is already a major shareholder and only left the company in September 2022, is set to pay £2.5m for 25 million new ordinary shares at a subscription price of 10p per share.
In an announcement later on Thursday, the firm said it had sold just £2.5m of shares at the end of the subscription period – suggesting that Wicks was the only investor to participate in the share subscription offer.
The housebuilder said it will use the cash injection “to fund working capital requirements within the company”.
On 1 March, the Beaconsfield-headquartered firm announced a delay to the publication of its financial results, after identifying possible breaches regarding “certain related party issues […] of which the board was not informed at the relevant times”.
At the same time, group chair Simon Bennett and two non-executive directors, Carol Duncumb and Brian Johnson, resigned. It also said it aimed to reappoint Wicks, who stepped down as CEO in September, to its board “as soon as possible”.
No further details of the potential regulatory breaches have been revealed, but companies listed on the London Stock Exchange’s Alternative Investment Market (AIM) – the market for SMEs – must immediately disclose the terms of a transaction with “related parties” such as shareholders, directors or their family members.
This week Inland Homes confirmed that it will miss the deadline to publish its audited financial results before the 31 March deadline.
It added that it was “in advanced discussions with a view to commissioning an independent report from a professional services firm” to review the related-party issues and that this was a precondition of its accounts being successfully audited. The process will take “a number of weeks”, it said.
The announcement, from finance director Nishith Malde, added that Inland Homes intended to request that trading in its shares be restored when it does publish the results.
In its last published accounts, for the year to 30 September 2021, the company reported a steep rise in pre-tax profit to £13.2m from an increased turnover of £182m.
Inland Homes warned last year that it was on course to make a pre-tax loss of £37m in its 2021/22 financial year. Wicks departed following this announcement.