SG Guernsey, which has £12.6m of stamp stock, is the investment product division of the group and the administration has been devised to sell off its assets and pay back creditors.
SG Guernsey's liabilities are expected to total £65m, largely relating to its controversial ‘buy-back’ investment product. The scheme guaranteed customers at least 75% of the book value of their stamps at the end of a given period. The scheme, devised under former management, was not approved by the UK financial authorities and the group stopped offering these buy-backs to customers in July 2016.
For the year to the end of March, total sales for SG Guernsey reached £18.8m and it made a divisional profit of £1m. However, due to payments made under the buy-back scheme it made a loss.
Ring-fenced
The group stressed other parts of its business are not affected by the move and are ring-fenced from the buy-back guarantees of this division.
The firm has been restructuring since Harry Wilson took over as chairman in May 2016.
The group revealed last month it was in default on its bank facilities – debt is at £16.5m – and reported a 48% reduction in net assets to £18m.
Stanley Gibbons last month sold auction house Dreweatts to consultancy Gurr Johns, including the Bloomsbury brand name for £1.25m. The deal does not include the dealer Mallett.
The wider Stanley Gibbons Group had also been in talks about potentially being sold. However, it is no longer in discussions.
