Sharechat Logo

Veritas to ditch Nosh by the end of March to keep onside with ANZ

Wednesday 14th December 2016

Text too small?

Veritas Investments will wind up its unprofitable Nosh supermarket business to keep in the good graces of its lender, ANZ Bank New Zealand. 

The Auckland-based company has until Jan. 15 to advise an unconditional sale of Nosh and, given the uncertainty of finding a buyer, Veritas's board has decided to look at closing Nosh by March 31, it said in a statement. The company had been looking at ways to improve the performance of the Nosh stores, with sale or closure as part of its revised banking facility agreement in October. 

"The sale or closure of the loss-making Nosh business would result in non-cash asset write-downs and one-off expenditure related to the sale or closure, although the amount of that expenditure cannot be quantified at this stage," chairman Tim Cook said. "From a go-forward perspective, although the sale or closure of Nosh will result in lower revenue for the group, it is likely to have a positive effect on the group's overall earnings." 

Veritas took on a $5 million funding line with ANZ to buy the Nosh stores in 2014, but has struggled to turn the gourmet supermarkets into a profitable business. It had set out plans to franchise the business in recent months.

The food and beverage investor renegotiated its banking arrangements in October to reduce its repayments and reschedule its debt, as its Mad Butcher and Nosh businesses weighed on the group. 

The shares were halted before trading opened today at 22 cents, and Veritas released the statement after the market closed. The shares have more than halved so far this year. 

 

BusinessDesk.co.nz



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

SML - Synlait Milk Limited - Trading Halt of Securities
AIA - Auckland Airport announces board chair changes
AIA - Auckland Airport announces board chair changes
CEN - Tauhara commissioning progress update
FPH initiates voluntary limited recall
March 28th Morning Report
KFL Celebrates 20 Years of Excellence in Investment Mgmt.
SVR - Savor FY24 Earnings Guidance & Change in Banking Partner
NZK - NZ King Salmon Investments Limited FY24 Results
March 27th Morning Report