THE City-based sports investment firm run by Northumberland businessman Keith Sobey has collapsed, with a key factor in its demise being the overheads associated with running a London operation.
Centaur, which is headquartered in Seahouses, ran a sports trading academy in London’s financial district and, as recently as January 2011, its founder believed it was on track to handle £20m worth of investment funds during last year, with a £2m- a-year revenue stream.
However, Sobey’s ambitions for the 12-year-old firm failed to materialise and he has now written to Centaur’s investors to inform them that he has filed for insolvency, bemoaning continuing losses at its London academy.
Sobey, a former senior manager at the Audit Commission, was unavailable for comment last night and both of his offices are now closed.
Meanwhile, a former Centaur investor who asked not to be named yesterday claimed to be among several individuals owed funds by the group.
In a letter to investors obtained by The Journal, Sobey said: “I am writing to you to express my sincere apologies for the fact that Centaur Corporate Holdings Ltd and its constituent companies Centaur Global Ltd, Centaur Academy and Centaur Swift Ltd have applied for voluntary liquidation.
“We have contacted the leading firm of administrators Begbies Traynor Ltd who we expect will deal with all outstanding claims from creditors, including clients, henceforward.
“This is not an action we have taken lightly and Andrew (Cork, a fellow Centaur director) and I have invested over £300,000 in personal monies trying to keep the business trading.”
Alongside the operating costs of his London academy, Sobey listed a lack of working capital and defaults by brokers as reasons for the company’s liquidation.
He also said that sports betting exchange Betfair had failed to deliver a contract signed in April 2011. However, a Betfair spokesperson refuted this and said that the company had paid Centaur to use its training centre and had not received all the days’ usage it had paid for.
Although Begbies Traynor said it has not been formally appointed as Centaur’s liquidators, the accountancy firm is assisting the directors with the process of placing the firm into creditors’ voluntary liquidation. It said that further details will be confirmed at a creditors’ meeting later this month.
Centaur opened its City trading academy in January 2010 on the back of changes to legislation which opened up the European betting and sports investment markets.
The 4,000sq ft academy in London’s City Tower offices delivered training, mentoring and analysis services to sports traders, with a daily course costing up to £500. The company’s investment products are privately- managed accounts rather than pooled funds and use investors’ money to follow betting programmes on horse-racing, football and tennis.
Sobey has said his horse-racing fund delivers a 200% annual return and hoped to expand the business into the US and eventually bring in revenues of £100m.
Centaur started life as a tipping service launched by Sobey and Cook after careers in public-sector finance.