The head of the troubled Avocet Group - 'specialists' in green fuel and hydroponic farming - has lashed out angrily at critics for 'badmouthing' the business while taking the opportunity to deny rumours suggesting he may have embezzled millions of pounds from investors.
Martin Frost, a director of a multitude of firms, many bearing the name Avocet, has also dismissed claims that he stands to gain from insurance settlements following the theft of £1.8 million worth of machinery and equipment from the Berwickshire farms where the Avocet operations were based.
In an extraordinary and hard-hitting circular to the 650 shareholders who have stakes in Avocet Natural Capital, Mr Frost warns that legal action will be taken against 'naysayers' after he claimed his family had spent over £95,000 in May alone "on private enquiry agents, lawyers, and counsel to bring these people to book".
Avocet Infinite PLC (now known as Omega Infinite) is in the hands of liquidators with a court order to wind up that entity. And subsidiary company Orrdone Farms (previously called Avocet Farms) is in administration with estimated debts of more than £3 million.
However, as Mr Frost told The Sunday Times last month a switch of company assets and intellectual property to Avocet Natural Capital Ltd. [ANC] means investors now have 50% more shares than they had with Avocet Infinite.
At the same time Mr Frost, who told the newspaper he suffers from terminal cancer and dementia, has amassed more than 13 million shares, giving him control of the business.
Meanwhile another investor with a significant stake in the Avocet companies has contacted Not Just Sheep & Rugby to outline serious concerns over the large sums of money now thought to be in the possession of the Group's directors. Various inter-linked firms are registered at an address at 25 Palace Street, Berwick-on-Tweed with the secretary in each case listed as Eirlys Lloyd Company Services.
The shareholder told us: "There has never been any evidence of the much talked about Avocet fuel being produced commercially and no sign the hydroponic crops are being grown for sale. There appears to be no business, just a shifting around of shares.
"A number of people who 'over-invested' in Avocet have been in touch with me as they are facing serious financial issues."
Our source believed the green fuel concept which is named Avocet had considerable merit having been tried and tested over a considerable period of time by previous owners of the patent. A properly constituted board and a well run commercial operation could have succeeded given the technology available, in their view. Hydroponics also worked well with a potentially huge order book waiting for producers.
But the disgruntled shareholder added: "There is no proper paper trail, and it has been suggested investors should bring in independent auditors to investigate Avocet group affairs but management will not allow that to happen.
"It has become clear that everything presented to investors was over-estimated. Assurances were given by director Bob Jennings that the fuel could now be produced in a continuous process rather than in batches, and it would provide an economic replacement for diesel. There was even mention of a production deal with a company down south but nothing has materialised".
Mr Frost begins his circular to shareholders: "This is a side issue to our trading, but nevertheless is a matter that needs addressing. No doubt because ANC Plc. has such good financial prospects our naysayers again choose to attack our company for their perceived personal gain."
He also writes: "No £14 million of money has been embezzled by me – indeed as Ryecroft’s (the company's auditors Ryecroft Glenton, now resigned) have already shown in the 2017 audited accounts some £7.8 million was lost by Omega Infinite on Orrdone Farms Limited.
"Furthermore, when the 2018 and 2019 accounts fall in, one will see that this figure rose to some £14 million in straight cash or nearly £20 million with interest – money due to Omega from Orrdone."
He then gives shareholders this assurance: "Omega Infinite Plc is NOT balance sheet insolvent: eventually as an Infinite shareholder you will receive back funds in addition to your ANC Plc shareholding."
As we reported previously, Ryecroft Glenton confirmed to Companies House last month that they had resigned as Avocet's auditors after failing to receive professional fees for work done.
According to Mr Frost's circular: "Although Ryecroft’s are still due some £70,000 they have remained supportive of Avocet and have assisted with the supply of documents & figures." The resignation, says Mr Frost, was a necessity allowing ANC Plc to promptly publish independent accounts with Companies House and so seek a listing on an exchange platform.
And in another passage of the eight-page document Mr Frost declares: "The suggestion that I arranged for the Harcarse & Sunwick items valued at £1.8 million to be stolen so I could claim on the insurance is denied. Factually, neither Avocet, nor I, have benefitted from one pound of insurance money.
"The current Avocet thefts of some £1.8 million of plant & machinery are being dealt with by Mr. Ashleigh Fletcher, the liquidator of Omega Infinite Plc. To date, there has been no theft pay-out by Avocet insurers."
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