Omega's revival back on the agenda

by EWAN LAMB 

Shareholders in the 'disruptive technology' Avocet group were told in early August that funds had been secured to restore the debt-ridden former parent company Omega Infinite PLC to the Companies Register.

The news followed a private meeting between Avocet chairman Martin Frost and Omega's liquidators Begbies Traynor at which an indication had been given that the £3 million would come from the Frost family and colleagues. The cash would also allow accountants Ryecroft Glenton, former auditors of Omega, to produce overdue company accounts for 2018 and 2019 ' hopefully by the end of September 2020'.

But so far those accounts remain overdue while Mr Frost's promise at the time of legal action against the administrators of another insolvent company, Orrdone Farms Ltd. has yet to materialise.

Now a virtually identical scenario has emerged from another 'very productive' meeting between representatives of Omega's successor Gennfros Ltd. and Begbies Traynor on Thursday of last week.

Though not a director of Gennfros, Mr Frost told potential investors in the new company at the weekend that the Begbies Traynor meeting had been greatly assisted by "the promise next week of a £2.1 million share convertible loan from our new investors."

Such a sum will be small beer for the unidentified investors in Avocet's 'revolutionary' fuel additive for according to Mr Frost they are willing to inject £750 million into the business.

In his report on Thursday's proceedings Mr Frost revealed the loan meant:"Gennfros agreed to put Begbies into funds so that the Omega Infinite Plc restoration process to the Company House Register can begin; pay off certain Omega creditors especially AFS Ventures Plc (a company controlled by Mr Frost which has been in liquidation since 2015); pay Ryecroft Glenton to conclude the 2018 and 2019 audits for Omega & Orrdone; and put Gennfros Limited, and Avocet legal teams into funds so that litigation can proceed, particularly against the Orrdone Farms Limited Administrators."

In a shareholder letter to Avocet Natural Capital Ltd.'s investors in August Mr Frost provided an account of a meeting and 'convivial lunch' with Begbies Traynor, the Omega liquidators, in York.

He wrote: "The main purpose of the Friday meeting was to agree a procedure and methodology of how Omega Infinite Plc could be restored to the Company House Registrar and thereby to set down a procedure which would provide maximum cash benefit to Omega Infinite Plc shareholders.

 "Initially, there was a general agreement that the £3 million cash I had secured from Frost family and colleagues would be sufficient to settle Begbies fees along with all necessary creditor payments and statutory interest. 

 

"Indeed, at first, Mr. Ashleigh Fletcher (liquidator of Omega) got down to basics and the discussion moved to the timing of the £3 million transfer to Begbies and how soon thereafter all necessary payments might be made to restore Omega to the Registrar."

 

"I then explained to Begbies that measures were in hand to sue these people once Avocet had the benefit of Ryecrofts [they resigned as auditors for non-payment of professional fees] accounts for Omega and Orrdone for the years ending 2018 and 2019.

"When asked as to timing and upon the grounds the legal actions would take I agreed to (a) provide the twin company accounts prepared by Ryecrofts hopefully before the end of September 2020 and (b) provide (subject to counsel’s agreement) copies of relevant legal opinions as and when such fell due. I was further annoyed when Begbies indicated that they thought that the Orrdone Administrators might seek to challenge Ryecrofts 2017 audited accounts as it appears that the Administrators have been fed spurious misinformation.

"I advised Begbies that with the benefit of the current fact find and Ryecroft’s accounts I would expect serious legal action to commence no later than October 2020."

Following Mr Frost's disclosures regarding last week's meeting with Begbies Traynor we contacted the liquidator's public relations representatives.

Not Just Sheep & Rugby offered an opportunity for the insolvency practitioners to comment on Mr Frost's points. We also repeated an earlier request for a list of creditors for Omega Infinite and asked when a report to creditors was to be produced and submitted to Companies House

A Begbies Traynor spokesperson said: “In line with statutory requirements, an annual report to creditors will be lodged with Companies House within two months of the first anniversary of our appointment as Joint Liquidators on 28 April 2020 and will contain all of the information that we are required to provide to creditors."

The only public indication as to the level of Omega's indebtedness has been given by Mr Frost himself.

In February 2020, some two months before a Winding Up Order was obtained from the courts, Mr Frost informed Omega investors - 650 of them held 22 million shares at that time -  of management's intention to go down the insolvency route.

Mr Frost stated: "Omega Infinite Plc is to go into some form of insolvency. A winding up petition initiated by lawyers Fieldfisher for some £400,000 is to be heard in London; likely now to support this petition are lawyers Womble Bond Dickinson for another some £600,000 along with various other creditors for £300,000. The total trade creditor indebtedness of Omega Infinite Plc is likely to reach some £2.5 million, and on top of which there are private Avocet controlled loans in excess of £10 million."