Merchant House Group, the financial services business where former Rangers owner Craig Whyte has a major interest, has overhauled its senior management and announced a funding injection of up to £2 million.
The group, which includes structured product specialist Merchant Capital and IFA arm Merchant House Financial Services, says it has secured a £1.35m working capital loan from turnaround specialist Beia Capital along with a share subscription and loan from Beia Investment Partners.
The group is 10.8% owned by Liberty Capital, a company registered in the British Virgin Islands and owned by Mr Whyte.
Merchant House shares have been suspended on the Alternative Investment Market since mid-April pending the results of a financial review. The group's custodian Pritchard Stockbrokers, where Mr Whyte was company secretary, had its activities halted by the Financial Services Authority in February, which was around the same time as Mr Whyte resigned the post and Rangers went into administration.
In March, all £350m of Pritchard clients' non-cash assets were transferred to a new custodian, but the regulator froze its cash assets.
Mazars, the administrator of Pritchard, estimates a £3.4m shortfall in the cash assets.
Merchant House Group told Money Marketing magazine at that time that it was "not aware" of a £250,000 unsecured loan to Pritchard which was listed in Pritchard's 2010/11 accounts.
As part of the funding move, Beia Capital's founder and sole director James Keane has been appointed managing director of Merchant House.
Beia Investment Partners partner Stephen Drew becomes non-executive deputy chairman.
However, Christopher Day remains chief executive and James Holmes remains chairman.
The firm says it will provide an update on its financial position and the share suspension in its results next month.
Mr Keane said: "The company has expanded very quickly on a thin capital base during a challenging period.
"We believe that there is great value in the com-pany's core business divisions."
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article