PUMX Puma Vct 10 Plc

TIDMPUMX

RNS Number : 1621R

Puma VCT 10 PLC

04 March 2016

Puma VCT 10 plc ("the Company")

Investment in Opes Industries Limited

Between 13(th) August 2014 and 28(th) August 2015, the Company invested a total of GBP3.45m into Opes Industries Limited ("Opes") as part of an GBP8.8m investment by Puma entities. Opes owns a 73 hectare site in north Oxfordshire with an operating landfill site for non-hazardous materials and an aggregates/gravel quarrying business.

The site had planning permission for a Materials Recycling Facility ("MRF") to process waste from commercial and industrial sources and from construction and demolition. The MRF was designed to separate metals for recycling, generate solid recovered fuel ("SRF") and send only a small proportion of the material accepted at the gate for landfill. As a result the MRF would mitigate the cost of landfill tax incurred from a consignment. The site also had planning permission for a gasifier to turn the SRF into a combustible gas for power generation.

The Company's investment was to provide funding for the construction and equipping of the MRF and working capital during the build-up of the trade. The funding was provided in the form of equity and loan stock and our interests are covered by a first fixed and floating charge over all Opes' assets including a charge over the land and buildings. A large industrial building (approx. 100m x 30m) was constructed to house the MRF which began operating during 2015.

In the early hours of Sunday 28(th) February 2016, a fire was discovered within the waste reception hall of the MRF. The fire has seriously damaged at least one third of the building and seems to have destroyed approximately half of the plant and equipment. However, the fire is still smouldering and the hall is inaccessible. It is therefore currently impossible to make an informed assessment of the extent of the damage. No one was hurt in the fire.

It is clear that the immediate consequence of the fire is that the plant cannot now operate and will require substantial rebuilding and reequipping before it can reopen. We understand that the MRF and the Opes business is insured in respect of plant, building and business interruption, but clearly it will take some time for insurers to assess the damage. Given the current status of the business, it is likely that the Puma VCTs will appoint an administrator of Opes very shortly.

The Company's board has carefully considered the situation and believes that when matters are clearer it will wish to make some provision against the Company's investment in Opes. The size of any provision remains open at present, but on the basis of current information it may be greater than 5% of the Company's Net Asset Value ("NAV") and therefore classified as material to NAV.

Enquiries:

   Graham Shore                          +44 (0) 20 7408 4090 

This information is provided by RNS

The company news service from the London Stock Exchange

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March 04, 2016 11:51 ET (16:51 GMT)

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