UK hotels and serviced office owner MWB Group has announced suspension of the listing of its shares and a loan-back stock on the official list of London Stock Exchange amid concerns it may not be able to meet its liabilities.
UK hotels and serviced office owner MWB Group has announced suspension of the listing of its shares and a loan-back stock on the official list of London Stock Exchange amid concerns it may not be able to meet its liabilities.
The group said the move had been triggered because its 75% owned serviced office subsidiary, MWB Business Exchange (BX), had indicated it may offset its monthly contractual payments to the group against the outstanding intercompany loan balance.
MWB Group said it is reliant upon the continuation of payments from BX in order to meet its liabilities and the group board has entered into immediate discussions with its primary lender and the board of BX.
'In the event that these matters cannot be resolved satisfactorily, the board expects that the value of the loan stock will be significantly compromised and that there will be no value remaining for existing shareholders,' MWB warned.
MWB and BX are in discussions as to whether net payments totalling £8 mln (just under EUR 10 mln), previously made by BX to MWB, are now repayable, and in regard to contractual payments due from BX to MWB of approximately £4.8 mln, which were to be paid to MWB in monthly instalments from September 2012 to February 2013.
The uncertainty means that the group accounts for the year to end-June 2012 could not be finalised and published by the deadline of Wednesday, 31 October. This left the company no option but to request suspension of its listing pending a resolution of the issues.
MWB owns the UK hotel brands, Malmaison and Hotel du Vin.
