Anglo United to reform itself as Falkland Islands Holdings

Anglo United, the troubled fuels company which makes Coalite synthetic coal, is to break up its operations and switch the name of its core business to Falkland Islands Holdings as part of a bid to rid itself of what it calls "unmanageable" debts.

The new company is the product of an last-ditch attempt to save the rump of Anglo's business after Thomas Potts withdrew a June offer to buy Coalite Products. Coalite Products owns the Falkland Islands Group, which comprises The Falkland Islands Company, The Falkland Islands Trading Company and Darwin Shipping.

Anglo's bankers have agreed to raise their stake in Anglo from 49.9 to 74.9 per cent in exchange for reducing the debt of pounds 37.9m. Shareholders will get a stake in Falkland Islands Holdings, whose debts will have been reduced to just pounds 2m - "a manageable level of debt," according to Anglo. Each shareholder will get one share in Falkland Islands Holdings for every 300 in Anglo. The new company will then seek a listing.

The new company will own Coalite and the Falkland Islands companies. But it will be able to sell all the old businesses except Coalite to Middlebright, a company owned by two of Anglo's directors, John Gainham and Roger Wallace. According to Anglo, Middlebright's shares are likely to have no value because of Anglo's old debts.

When the new company lists, Collins Stewart, the stockbroker firm, will reduce the banks' stake to 40 per cent by placing 2.1 million shares at 100p each.