Institutions Take Control Of Izodia From Jersey Orb Directors

by Jason Gorringe, Tax-News.com, London

28 January 2003

Institutional shareholders gained control of the board of UK-listed cash shell Izodia last week after they appointed several of their own directors, and the last representative of Orb resigned. Orb is a Jersey-based investment company which owns 29.9% of Izodia, and made an indicative offer for the company in October.

In December the UK's Serious Fraud Office raided Orb's offices in Jersey in connection with allegations of theft from Izodia, whose shares were then suspended by the Financial Services Authority. Izodia itself was an e-commerce company which raised cash for a failed dot-com venture, and as of September retained about UK£33m of that cash. It is one of a number of cash-rich ex-dotcoms which have proved to be interesting vehicles for ongoing activities of other types. Last week the SFO was said to be investigating the whereabouts of the £33m.

The Izodia director who resigned last week, Peter Catto, had worked with Orb, and was a director of one of its subsidiaries until last July.

In December, shareholders of Izodia told the FT that they were amazed and disturbed by the SFO's action, and Orb said that the timing of the raids was particularly unfortunate, since the company was about to send a circular to Izodia's shareholders advising them of the appointment of a liquidator who would return Izodia's cash to shareholders, perhaps at a rate of 52 pence per share.

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