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Orb backs off from bid for Thistle chain

Horeca

JERSEY investment group Orb, which is at the centre of a Serious Fraud Office investigation, yesterday withdrew its interest in acquiring Thistle Hotels.Takeover rules had required the group to submit a bid for the leisure chain by January 15.

The move follows December’s raid by SFO investigators of Orb’s offices in response to “an allegation of unlawful appropriation of funds” belonging to Izodia, a London-listed cash shell in which Orb is the largest shareholder. Izodia’s shares have been suspended.

Orb denies any wrongdoing. It declined to give a reason for withdrawing from any Thistle bid, but insisted that no normal sources of funding had been turned off following the investigation.

It is believed that in August, pounds 27m of Izodia’s remaining pounds 33m cash pile was moved from the company’s Bank of Scotland account in Reading to a similar account with RBOS in Jersey.

That cash was then transferred again, this time to be managed by Lynch Talbot, another Jersey investment group which has shareholders in common with Orb. The second transaction is thought to have been conducted with the approval of the only two remaining Izodia board members, Orb employee Jarlath Vahey and Peter Catto, a former director of Orb Estates.

Since that transfer, shareholders have asked for bank statements detailing the whereabouts of the funds, but have yet to receive the documents.

An EGM scheduled for January 29 will see shareholders vote on the removal of Mr Vahey and Mr Catto and the installation of new directors.

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