Edmonds lines up new mining float

PHIL Edmonds has a reputation for controversy. The elegant left-arm spinner was famously outspoken as an England cricketer in the Seventies and Eighties, though it was his wife Frances who made most waves when she kept a secret diary of life on tour in the West Indies. The revelations made headlines and lost the couple a number of friends.

As a regular in the test side from 1975 to 1987, Edmonds, 54 last Tuesday, rarely showed any sign of self-doubt. And he will need all his self-confidence as he faces up to a barrage of hostility from City critics over his most recent business deal.

Shares in his latest company might have been suspended, but Edmonds is already planning his next flotation, undaunted by the controversy that has engulfed his recent oil company listing, White Nile.

Shares in White Nile, which soared in the days after it was floated, are now suspended. The Financial Services Authority is investigating trading in those few days last month. Meanwhile, the company's sole claimed asset - oil drilling rights in southern Sudan - are hotly disputed by the government in Khartoum and by French oil giant Total.

But this has all been brushed off by the former Middlesex player, who is already contemplating his next launch on the junior Alternative Investment Market (Aim). Edmonds' investment company, Central African Mining and Exploration (Camec), announced last week the first stage of a deal with South African group Veremo to extract iron and titanium ore. Camec is investing an initial £1m, but the plan is to float a new company on Aim within months.

Edmonds says: 'Camec participation is very much part of the company's strategy of investing in resource projects in Africa and adding value through the creation of independently listed vehicles.'

Whatever people think of him - and City opinion is sharply divided - many admire Edmonds' chutzpah to be talking of a new stock market launch while his last one is still mired in controversy. White Nile shares jumped from only 10p to 138p in four days last month, valuing the group at £215m, before they were suspended on 16 February.

The company claims to have the rights to oil reserves agreed with the government of southern Sudan, recently recognised as an independent authority by the main government in Khartoum after years of civil war. But the regime in the capital does not recognise the White Nile deal and backs a rival claim by Total, which signed its own deal in the Eighties before the civil war broke out.

Edmonds says details and proof of White Nile's credentials in Sudan will be released by the end of the month. In the meantime, investors have only his record to go on, and those of a cautious nature are unlikely to be reassured.

One broker says: 'He has a fan club and a number of close associates who are always involved in his deals.' But another says: 'He doesn't actually know how to run companies. Everything's just a massive punt built on big promises.'

Since the end of his illustrious cricketing career, Edmonds, who was born Philippe-Henri Edmonds in Lusaka, Zambia, then Northern Rhodesia, has bought and sold a stream of businesses. Fans point to the recent success of Camec, where the shares have risen 207% since its flotation in 2002.

The other highlight has been Southern African Resources, where shares have risen by 200% since its flotation, also in 2002. Edmonds has since sold his stake in SAR, but retains a 9.5% stake in Camec, worth £6mion.

However, Edmonds' business record also includes rather less successful ventures. Central African Gold, launched on Aim last April, is not so buoyant. After peaking at 8¾p, the shares are now down to 5¾p. Investors who bought shares towards the peak are out of pocket, but Edmonds is doing nicely. Having exercised his options in the company at 1p a share, he is now sitting on a paper profit of almost £1m.

At White Nile, Edmonds and other close associates bought stakes at 0.1p a share. When shares were issued, they were sold at 10p and have since soared to 138p. Even if the shares slump all the way back to 10p, Edmonds will still win.

Sceptics also cite Philippine Gold, formerly London Fiduciary Trust. Edmonds joined LFT as chairman in 1994 and the group was renamed Philippine Gold after its main interest became rights to a gold mine near Manila.

In the mid-Nineties, Philippine Gold raised about £25m from investors. The shares, which had been at a low of 5p, soared to 300p. However, the company never made any profits and the shares, which had slumped far below their peak, were suspended in 1997 after the company failed to file accounts on time.

Edmonds was faced with a shareholder rebellion and stepped down as chairman in 1998. At the time, Philippine Gold tellingly commented that Edmonds was leaving 'to allow mining professionals to take over the running of the company'.

As a businessman, Edmonds seems to have a knack of making a lot of money for himself. However, his record of making money for his investors is not quite so impressive. White Nile might prove to be the defining moment for his business reputation. If it goes wrong, Edmonds might find it hard to get his new South African iron ore project off the stocks.

Without detailed proof on circumstances of trading at White Nile and the prospect of oil riches in southern Sudan, that toughest of all umpires, the City, could prove hard to convince.