Small Talk: Mystery of Boustead's missing cash no nearer to a resolution

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Trading in Boustead shares, readers will remember, was halted in February pending clarification of its financial position. Its auditors have still not been able to sign off the accounts for the year to March 2004. And now, the accounts for March 2005 are also overdue. An army of small shareholders have had no communication from their company since the suspension.

Sir Thomas tells Small Talk not to worry. He is "expecting the nod at any minute" from the auditors, Kingston Smith. "It is all pending and so very nearly ready for issue, with full circulars and so forth, that it would be quite out of order for me to make a further statement."

The £2.6m is all accounted for, he insists. Some £500,000 is held as cash in the bank, and £2.1m is invested in convertible bonds to fund a coal mine in Queensland, Australia.

Oh? In February, Sir Thomas said the money had been lent to a business partner in the Far East, which needed security for a government engineering contract. Last year, the tale was that the cash was being held in a Cayman Islands bank account and the paperwork to prove its existence had been delayed because of hurricanes.

Now Sir Thomas makes the extraordinary statement about the progress of the audit: "There is no hitch and to the best of my knowledge there are no outstanding requests for information from Kingston Smith." It is a statement that may come as a surprise to Kingston Smith, which has made no significant progress for a year.

Kingston Smith is refusing to resign, despite the stonewalling from Boustead, but its responsibility is only to audit information, not to seek it out. Whose responsibility is it to find out what has really gone on, or to call in legal authorities who can begin an investigation?

The company's shareholders are in the same limbo as those in Easier, another cash shell which shares an office and a controlling investor with Boustead. Some £5.4m is unaccounted for at Easier and two sets of auditors have resigned in frustration at its management's refusal to provide information. Rebel shareholders are still waiting for a High Court judgment on whether they can be installed on the board to find out what has happened.


Telematics has a bad name in the City. It is the technology of vehicle tracking, in which telematics devices are placed in company cars or lorries to make sure they are where they are supposed to be. The trouble is, companies have repeatedly disappointed the market. Minorplanet Systems, for example, has just had to be bailed out by shareholders after racking up impossible debts.

So it is with a little trepidation that Trakm8 is joining AIM. It hopes its recently launched products will stand out in a crowded market because they are more flexible. Extra features such as temperature sensing are available, and the kits could work for congestion charging, road tolls and pay-as-you-drive car insurance. Two FTSE 100 companies are distributors.

Trakm8 will be valued at £10m, one-third of the value it hoped for when it began planning for a float in May.

First Artist

First Artist Corp, the football agents business run by Jon Smith, is doing well, we hear, after integrating its new businesses. It is moving into wealth management, offering its footballers financial advice, and events management, where it can organise star appearances.

Carrying coals to market

A company set up in 1994 with 20 lorries to cart coal around the UK, and which now has ten times as many vehicles, is about to make its debut on the stock market.

Hargreaves is joining AIM, raising £20m to pay for a recent acquisition and to give it the financial muscle to further diversify its expanding business.

The company bought Monckton Coke Works from UK Coal for £12m earlier this year, making it the only independent producer of coke for use in the production of specialist alloys and for domestic heating.

Gordon Banham, Hargreaves' chief executive, expects that the UK's growing reliance on imported coal will be a boost for its haulage business, while the company also has expansion plans in the rubbish collection and port operations. There are also efficiency improvements to be made at Monckton.

Brewin Dolphin, broker to Hargreaves, expects the company to have a market value of £60m.