LONDON (Alliance News) - Sefton Resources Inc on Wednesday said it is "clear" that there was an "aggressive dissipation" of the company's funds leading up to the appointment to the board of financial market website ADVFN founders Clem Chambers and Michael Hodges.
Chambers was named chief executive of Sefton, with Hodges as a non-executive director, after a protracted battle for control of the company. They were nominated by a trio of investors, comprising of former interim chairman Daniel Levi, oil investor Christopher Williams, and Charnjit Matharu, who were behind a requisition to remove the bulk of the company's previous board.
The ADVFN founders are due to stand for re-election at the company's upcoming annual meeting of shareholders. However, that meeting is now set to be delayed. Depending on "progress", Sefton said, the meeting is to be held in the first half of December.
"It is clear that there has been an aggressive dissipation of funds leading up to the new board appointments of Clem Chambers and Michael Hodges," Sefton said.
In addition, Sefton said that Chambers and Hodges, who took on their roles on October 23, have not yet taken "full control" of the company's function as they are yet to receive "material hand-over information".
"They [Chambers and Hodges] are currently working on reconstructing the necessary access and information and due to a lack of cooperation from the previous administration, this will be likely be a long process," Sefton said.
While an October 23 statement had said that Sefton's cash balance was USD504,300, Sefton on Wednesday said that "as the actions of the board leading up to our appointment appears to be to the serious detriment of shareholders it leads us to fear the worse".
Meanwhile, Sefton is continuing its search for a nominated adviser, which is required for a continued listing on AIM, but conceded that "after an already exhaustive search it seems unlikely one will be found".
"We plan to update the shareholders again at the AGM, by which time we will know the true position of the company, which from our initial discoveries, suggest will be significantly less robust than shareholders have been led to understand," Sefton said.
The company's previous Nomad, Allenby Resources, resigned upon the appointment of Chambers and Hodges. The stock remains suspended from trading on AIM.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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