HSBC sells bankrupt Leech's 34 per cent ML stake

Bankers for ML Laboratories, the drug development company built up by Kevin Leech, have sold the 34 per cent stake once held by the bankrupt billionaire.

Mr Leech was declared en désastre by the courts in Jersey a year ago, and the stake passed to HSBC, his biggest creditor and the organisation which initiated bankruptcy proceedings over a £22m debt.

The 54 million ML shares were sold yesterday at 25p a share, raising £13.6m.

Stuart Sim, the chairman, said the stake had been taken up by institutional investors after a successful roadshow in the City. "I am delighted with the successful placing by our brokers Panmure of the stake of our former chairman and by the strong support shown for the company by institutional investors, many of whom we understand are new shareholders to the company."

Panmure placed the shares at a discount of 15 per cent to the prevailing share price and the stock closed up 1.5p at 30.75p to reflect the fact that a big, unwilling shareholder had been cleared out without having to dump its stake on the open market. Mr Sim is struggling to rebuild the reputation of ML, whose products include drug inhalers and potential new treatments for cancer, kidney failure and sexually transmitted diseases.

Mr Leech, meanwhile, is keeping a low profile in Jersey. One local friend said: "All his affairs are in the hands of our equivalent of the official receiver and he just has to sit back and do his penance for another three years, until he can emerge and take up directorships again."

Mr Leech's property and leisure empire at one time stretched from Land's End to John o'Groats, taking in the tourist sites at both locations. Having reached number 17 in the Sunday Times Rich List, he was brought down by disastrous dot.com investments.