Investors take a plunge, to the bottom of the sea

Ever had that sinking feeling? To treasure hunter Henry Newrick, it can mean a fortune lying in wait. David Bowen reports y y

HENRY NEWRICK is an unlikely treasure hunter. He wears a sober suit, does not own a parrot and has the air of the solid New Zealand business publisher he is. But if Caribbean Marine Recovery, the company of which he is chairman, successfully dredges enough goodies from the seabed, he will become one of the big players in a fast-growing and exotic industry.

CMR hopes to raise up to pounds 6.5m when it floats on London's Alternative Investment Market next month. Its first task, as the world's first quoted treasure- hunting company, will be to raise wrecks around the islands of Antigua and Barbuda. The islands' government has given it a five-year concession, following three years' work during which the company identified 20 wreck sites. Early prospects include a pirate vessel, two Spanish naos (early galleons), an English slave ship and HMS Griffin - all sunk in the 17th or 18th centuries.

Although an archaeologist will be aboard the recovery vessel, investors will be interested in one thing only - the value of the wrecks and their cargo. One of the naos is believed to have been carrying gold and silver, while the slaver probably has gold that would have been used to pay chiefs in Africa. But, Mr Newrick points out, almost any artefact has some value - cannon balls would make excellent doorstops, he suggests.

The potential wealth lying at the bottom of the ocean is immense. The shallow waters of the Caribbean are particularly attractive. "There are 3,000 wrecks around the Bahamas and 700 around Cuba," Mr Newrick says. The trading routes of south-east Asia are also rich hunting grounds. The most valuable single wreck, the early 16th-century Flor de la Mar, is reputed to have a cargo worth between between $1bn (pounds 630m) and $9bn. It is somewhere on the seabed of the Straits of Malacca.

Before a salvage company can start looking for such treasures, it has to be given a concession by the government, which typically takes 25 per cent of whatever is raised. CMR is unusual in having a long concession, which is also why it is able to float. But the lifeblood of the industry is the wealthy individual investor. Henley-on-Thames-based Venture Capital Report, a marriage bureau for business angels and entrepreneurs, has been involved in four marine salvage schemes in the last year. Three are "non-treasure" - but VCR is also helping raise pounds 300,000-plus as part of a pounds 2m project to raise the Blessing of Burntisland. It sank in the Firth of Forth in 1633, while carrying the silver plate and other items for Charles I's coronation in Scotland. Investors are being invited to buy into the scheme with pounds 5,000 shares.

They are also being told there is no guarantee of success. Salvage is a business that appeals to people who can afford to lose a few thousand, or even a hundred thousand. "Our investors have typically made their own money, and now want to invest in a high- risk, high-reward project," says James Mallinson, project director of VCR. "But unlike many businesses, the risks are pretty clear cut - and then there is the romance of treasure hunting."

There are many more stories of failure than success. In 1980, Mr Newrick raised pounds 500,000 to salvage HMS Lutine, the warship that sank off Holland in 1799 and triggered Lloyd's first payout (as well as giving it its famous bell). "One guy invested pounds 65,000," he says. "He said he didn't mind if he lost the money because he made 10 such investments a year, and needed only one to come off to make money." This was not his lucky investment. "We had the worst weather in 40 years, and we failed," Mr Newrick says.

But it is the stories of triumph that keep the money pouring in. Keith Jessop, a British diver, recovered pounds 40m of gold bullion from the cruiser HMS Edinburgh off the north Russian coast. He became a millionaire as a result.

In March this year, 24,000 pieces of Chinese porcelain were sold by Christies for pounds 2.2m. The porcelain was recovered from the wreck of the Diana, an East Indiaman that sank off the coast of Malaya in 1817. Dorian Ball, a Leicester-born South African, spent 800 days searching 28 miles of seabed to find it.

The chances of success are improving all the time, though, as technology develops. Jacques Cousteau's invention of the aqualung during the Second World War was critical. So was the development of sophisticated magnetometers, which can now even differentiate between different types of metal. Another invention, from about 1970, is the "mailbox", a machine that blasts a jet of water at the seabed to uncover remains.

Most of the wrecks now being investigated are in shallow coastal waters, but there is increasing interest in the deep oceans. The Portuguese government has given concessions for salvors to search around the Azores. "You're talking tens of millions for this sort of operation," Mr Newrick says. "They will be using robots and mini-submarines."

But the industry hangs out one big warning sign to potential investors. Treasure hunting is the modern equivalent of gold-prospecting, and thus has more than its share of conmen ready to play on the gullibility of those swept along by its romance. Many people have been impressed by a presentation and have decided to invest - only to find that the "salvors" then become as difficult to find as the treasure they had promised.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Claims Administrator

£16000 - £18000 per annum: Recruitment Genius: A position has arisen within th...

Ashdown Group: Development Manager - Rickmansworth - £55k +15% bonus

£50000 - £63000 per annum + excellent benefits : Ashdown Group: IT Manager / D...

Recruitment Genius: Security Officer

£16500 per annum: Recruitment Genius: Applicants must hold a valid SIA Door Su...

Ashdown Group: Business Analyst - City, London

£50000 per annum: Ashdown Group: Business Analyst - Financial Services - The C...

Day In a Page

The saffron censorship that governs India: Why national pride and religious sentiment trump freedom of expression

The saffron censorship that governs India

Zareer Masani reveals why national pride and religious sentiment trump freedom of expression
Prince Charles' 'black spider' letters to be published 'within weeks'

Prince Charles' 'black spider' letters to be published 'within weeks'

Supreme Court rules Dominic Grieve's ministerial veto was invalid
Distressed Zayn Malik fans are cutting themselves - how did fandom get so dark?

How did fandom get so dark?

Grief over Zayn Malik's exit from One Direction seemed amusing until stories of mass 'cutting' emerged. Experts tell Gillian Orr the distress is real, and the girls need support
The galaxy collisions that shed light on unseen parallel Universe

The cosmic collisions that have shed light on unseen parallel Universe

Dark matter study gives scientists insight into mystery of space
The Swedes are adding a gender-neutral pronoun to their dictionary

Swedes introduce gender-neutral pronoun

Why, asks Simon Usborne, must English still struggle awkwardly with the likes of 's/he' and 'they'?
Disney's mega money-making formula: 'Human' remakes of cartoon classics are part of a lucrative, long-term creative plan

Disney's mega money-making formula

'Human' remakes of cartoon classics are part of a lucrative, long-term creative plan
Lobster has gone mainstream with supermarket bargains for £10 or less - but is it any good?

Lobster has gone mainstream

Anthea Gerrie, raised on meaty specimens from the waters around Maine, reveals how to cook up an affordable feast
Easter 2015: 14 best decorations

14 best Easter decorations

Get into the Easter spirit with our pick of accessories, ornaments and tableware
Paul Scholes column: Gareth Bale would be a perfect fit at Manchester United and could turn them into serious title contenders next season

Paul Scholes column

Gareth Bale would be a perfect fit at Manchester United and could turn them into serious title contenders next season
Inside the Kansas greenhouses where Monsanto is 'playing God' with the future of the planet

The future of GM

The greenhouses where Monsanto 'plays God' with the future of the planet
Britain's mild winters could be numbered: why global warming is leaving UK chillier

Britain's mild winters could be numbered

Gulf Stream is slowing down faster than ever, scientists say
Government gives £250,000 to Independent appeal

Government gives £250,000 to Independent appeal

Donation brings total raised by Homeless Veterans campaign to at least £1.25m
Oh dear, the most borrowed book at Bank of England library doesn't inspire confidence

The most borrowed book at Bank of England library? Oh dear

The book's fifth edition is used for Edexcel exams
Cowslips vs honeysuckle: The hunt for the UK’s favourite wildflower

Cowslips vs honeysuckle

It's the hunt for UK’s favourite wildflower
Child abuse scandal: Did a botched blackmail attempt by South African intelligence help Cyril Smith escape justice?

Did a botched blackmail attempt help Cyril Smith escape justice?

A fresh twist reveals the Liberal MP was targeted by the notorious South African intelligence agency Boss