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Board considering leaving AIM after Eredene asset value falls sharply

ERE : Board considering leaving AIM after Eredene asset value falls sharply

Eredene published its accounts for the year ended 31 March 2014 today. The net asset value fell to 11.3p from 18.5p. They are still trying to sell off the portfolio and cut overheads and have had some success – the recent Sattva deal netted £1.9m and they say overheads should be kept to £1m in 2015 (down fro £2.4m this year and £3.4m last).

The board says it is thinking about cancelling the fund’s admission to AIM – thinking this will help cut costs and ease the disposal process (though they still think this will take another one to two years).

The big news on the portfolio might be that Eredene has succeeded in taking control of Matheran & Gopi resorts – a construction project in Maharashtra. Eredene has sunk £16.1m into this investment but it is currently valued at £3.2m. With control, they can now seek to appoint a new developer and, hopefully, move things forward (though they caution that the real estate market is subdued and it is hard to come by development finance).

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