Memorandum submitted by David Neville
Porter
1. I am a bookmaker, as I have been all
my working life. I am now aged 48. I live with my wife, Coreen,
in County Durham.
2. I left school at 16 and then went to
college where I obtained ONC/HNC qualifications in business studies.
3. I was always interested in racing. I
can remember as a small boy first going to a dog track. Later
I started going to racecourses. As I got older, I travelled further
afield.
4. In about I979, at the age of 20, 1 obtained
my bookmakers permit. I became a bookmaker around the local greyhound
stadiums. The seniority position was then in place which meant
that I had to wait to receive even a back line pitch which was
generally unprofitable, but I was prepared to try to work my way
up from the bottom and so I took whatever I could. I was reliant
on the income from greyhound racing because I was not in a position
to make any worthwhile living on the racecourse.
5. In order to try and improve our income,
my wife and I managed to acquire a pub in Bishop Auckland. We
worked hard, refurbishing the property and building up trade.
We then sold it and used the proceeds to acquire a greyhound stadium
for the then very substantial sum of £150,000. I continue
with that business until 1985 when I sold it for £260,000
before Capital Gains Tax. From about 1989 l had also owned and
operated holiday and rental properties and had bought properties
for refurbishment and resale.
6. In 1998 the seniority position, which
had existed since long before I came into the business, finally
ended following the adoption and implementation of the recommendations
in the Sparrow Report. At last I had the opportunity to invest
in building up a worthwhile bookmaking business. My wife and I
agreed to dispose of our properties and to buy pitches. In 1998
we invested £100,000 into the business by buying pitches
and upgrading our pitch positions as and when better ones became
available.
7. At no stage did I believe that security
of tenure was or could ever be an issue. Looking back now, I still
cannot detect anything from which I might have been expected to
query the position. As put forward to the racing industry, the
future position about the acquisition of pitches was clear. Everybody
acted on the same basis. I saw a video produced by Sir John Sparrow,
I attended meetings with the NJPC (roadshows) and at each and
every meeting it was obvious that pitches were bought and sold
in perpetuity.
8. Because of the changes to the possibility
of building up an on-course business post-Sparrow, I decided to
try and develop my business in a new way. I sought professional
advice and it was suggested that I should consider floating my
business as a company with an AIM listing. I formally instructed
SVS Securities to advise me. With their help and guidance, Neville
Porter plc was floated on AIM with a capitalisation of £3.26
million. The pitches were valued at £1.095 million; this
formed the majority of the Company's asset value. This happened
on 28 February 2007, two weeks before the RCA letter of 14 March.
As a consequence, the share price has fallen considerably.
9. With this submission, I produce a copy
of the AIM placing document and a list of the current shareholders
who bought their shares on the basis of the Company's prospects
as so carefully outlined in the placing document. These documents
are marked, respectively, Annexe 1 and 2.[1]
10. I was struck by the care and caution
exercised by the professional advisers to the issue when they
were carrying out due diligence. At no stage did it occur to anyone
that there might be a problem about pitch valuation because of
any uncertainty over security of tenure. Had there been, it would
have had to be disclosed and I very much doubt whether the issue
would have proceeded at all.
11. I have worked very hard to build up
my business. 1 am proud of what I have achieved for my family
and for all the investors who backed the future prospects of the
business. I do not consider any of my business decisions to have
been other than cautious and based on the most reliable evidence
and advice available.
12. I have read the submissions to be lodged
by FRB. I agree with them. If security of pitch tenure really
is in jeopardy, so is my business. I am more than willing to give
evidence to the Select Committee to explain why I believe that
I bought what I paid for, namely pitches in perpetuity.
October 2007
1 Not printed. Back
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