Stanley Gibbons’ failed Guernsey investment vehicle no seal of approval

An unknown number of investors, but described as “hundreds”, are faced with the uncertainty of the news that the Guernsey-registered investment arm of well-known stamp collecting firm Stanley Gibbons has been placed in receivership, although that the parent company be “isolated” from the fallout.

The subsidiary was an investment program that encouraged investors to buy “rare” postage stamps with the guarantee of a “buyback” that promised either 75% of the current market value of the stamps or 100% of the price they paid. they had paid them.

The program is said to have over £ 70million in liabilities, although only £ 6.5million is owed to the parent company.

The subsidiary holds around £ 12.6million in “philatelic stock”, the parent company said in a statement released today.

The subsidiary’s “potential liabilities”, the company said, consist primarily of around £ 54million of contingent liabilities related to buyback guarantees, and around an additional £ 11million of liabilities included on its balance sheet. .

The £ 6.5million owed to the parent company would, he said, “rank alongside other unsecured creditors, mostly made up of bank debts and payments owed to holders of
investment products ”.

The program stopped accepting new clients last year due to concerns over the exposure contained in the 75% buyback program.

One program required a minimum deposit of £ 10,000 for a period of five to seven years, which would buy between five and seven stamps.

PwC, who was appointed a director, said the first task was to reconcile the stock with the investment portfolios, but said there was “no reason” to expect deviations.

A need to reduce liabilities

The motivating factor for the parent company appears to be the reduction in exposure to the liabilities of the parent company due to the buyout guarantee.

Unlike other collapsed investment programs, there are still stocks to be assessed to determine value for investors.

Over the past decade, the rare stamp market has grown, and as the program has been marketed as a long-term holding, that doesn’t mean investors have lost yet.

However, problems could arise for investors who wish to cash in now, as the sudden appearance of a large number of rare stamps on auction could have some downward influence on their value.

The parent company “optimistic” about its future

The parent company, which has been in existence since 1856, was optimistic about its long-term outlook, although it acknowledges it was a difficult time for it.

While current trade has remained “subdued,” he said, it was in default on its banking facilities. However, he said he was “in constructive dialogue with the bank over its ongoing funding.”

She announced that she had appointed Guy Croton to the post of general manager of philately.

“Guy is well respected,” the company said, “after a 22 year career in the industry, the last 15 years with Spink, most recently as the head of the philatelic division”.

Previous Litigation Funding: An Increasingly Popular Investment Vehicle
Next Pique builds his portfolio by buying FC Andorra through investment vehicle Kosmos