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Torex, the retail software group that is the subject of an investigation by the Serious Fraud Office, on Wednesday announced it had secured an additional £15m of funding from its banks and appointed a new chairman.
The short-term loan, provided by a syndicate of banks led by Royal Bank of Scotland, will stabilise Torex’s finances as it struggles to overcome allegations of fraud and management upheaval.
The announcement that Steve Marshall, a former chief executive of Railtrack, the railway operator, and current director at Balfour Beatty, will become non-executive chairman is the latest in a series of appointments aimed at shoring up the management team following allegations of fraud against the company and the launch of an investigation by the SFO.
Earlier this month Torex appointed Keith Taylor, a turnround specialist with management experience at software groups Morse and Admiral, as chief executive. It also appointed Iain Lynam, who had experience of managing IT companies, with responsibility for any restructuring that may be required at Torex.
As part of the restructuring Torex also created a management committee chaired by Geoffrey Forster, a non-executive director, to manage the day-to-day operations of the company.
On Thursday, Torex said Mr Forster would relinquish the interim chairmanship of the committee in favour of Mr Marshall who takes over the role as part of his new responsibilities.
Shares in Torex have been suspended since the company released a profit warning last month and delayed the publication of its accounts.
Following the profits warning Christopher Moore, the former chairman and founder of the software group, and Neil Mitchell, the chief executive brought in by Mr Moore, stepped down from their executive posts.
On Thursday, Torex said it expected to hold further discussions with its financial backers about its medium and long-term future when the company had finalised its 2006 accounts and was in a position to update on trading prospects for the current year.
“The board is very pleased that it has concluded discussions with the company’s lenders with respect to its short-term financing requirements and that the company’s lenders remain supportive,” it said in a statement on Thursday.
Separately, FTSE International announced the removal of Torex shares from a number of its indicies.
The indicies manager announced Terrace Hill Group, the property group, will replace Torex in the FTSE Aim 50 index and Accsys Technologies, the environmental science company, will replace the software group in the FTSE Aim 100. Torex shares will also be removed from the FTSE Aim All-Share.
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