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HHV vct

Sophisticated and complex high-risk tax-sensitive investments in small companies: handle with care
barchid
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HHV vct

#476504

Postby barchid » January 27th, 2022, 11:08 am

A disturbing post from Mike Dennis of Sharesoc, on their site concerning an unquoted investment, Honest Brew, in this AIM vct which cost £2.8mill + £300k recently for their loan notes and is in the last accounts at £277k + the loan notes at cost.
This is one of the very largest cost prices of any of their investments & while we all know that there are swings & roundabouts in VCT land this is especially intriguing as, according to the post from Mr Dennis, that the % of Honest Brew owned by HHV is 37% "far in excess of any other investee co in their portfolio". HHV then bought, last year, £300k of loan notes & even more intriguing is that apparently the Chair & family of HHV are also investors in Honest Brew to the tune of a further 20%+, all in what is a predominantly AIM vct.
It will be interesting to see if the board comment on this, I have had HHV as a core holding in my VCT portfolio for many years & have been happy to hold it, I for one will be looking forward to hear their explanation or refutal of that post.

Kidman
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Re: HHV vct

#476648

Postby Kidman » January 27th, 2022, 7:04 pm

I am not a shareholder of HHV but thought I would have a look to see what I could find just out of interest!

The companies have a common director in David Michael BROCK, born 1949.

Until 17 Sept 2020 HHV had "significant control" of Honest Brew but was then replaced by CWGL Nominees Ltd a/c GC1 so we can't see who is in control now. Looking at the list of shareholders, shares were transferred from HHV to CWDL which resulted in that change and it may be merely that CWDL is now a nominee for HHV. The shares involved were 12,060,893 'D', 6,583,419 'E', 16,652,176 'F' and 23,235,595 'I' shares.
Just after those shareholdings in the list, David Brock, Jean Brock, Helen Brock and Catherine Stock-Haanstra are listed with 6,854,843 'K' shares each, that being all the 'K' shares issued. Since then there have been 'L' and 'M' shares issued bringing the total munber of shares in issue to 157,383,048. David Brock also has 10,676,680 'G' shares.
It appears that recent share and convertible loan issues have been to help the company as the accounts "indicate that a material uncertainty exists that may cast signifcant doubt on the company's ability to continue as a going concern". (Quote from page 12 of accounts to 31 December 2020).

barchid
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Re: HHV vct

#476882

Postby barchid » January 28th, 2022, 2:44 pm

Kidman
Thanks for your delving, but I think you may have transposed a letter re the nominees as I note in my accounts that "Custodian" is Cannacord Genuity Wealth Ltd, which would be "CGWL" ?
Cannacord of course bought HH a few years back, hence it would make sense for them to set up their own nominees, I guess.
Nevertheless the holdings in Honest Brew & their loan notes are both showing as of 30 Sep 2021 so Dennis seems to be spot on.
Certainly the corporate governance in this vct seems questionable and I wonder if any shareholders might raise this at their AGM on Feb 3 at 41 Lothbury at 10.30 ?
David Brock is indeed the current Chairman.


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