Hibernia Foods is unlikely to continue as a listed company as receivers appointed to the group at the weekend seek to sell its businesses as going concerns to new investors, The Irish Times learned yesterday.
Financial institution General Motors Acceptance Corporation (GMAC) placed Hibernia in receivership at the weekend. The Irish-headquartered group, listed on New York's Nasdaq market, owes GMAC £17.25 million (€25 million). Mr Ray Jackson of receiver KPMG said yesterday the accountants' firm hoped to sell Hibernia's bakery and food businesses as going concerns. In that circumstance, he predicted that the company would be unlikely to continue as a listed entity.
He was appointed receiver to Hibernia Foods plc, based in the Republic. Staff from KPMG in the UK have been appointed to Hibernia's British subsidiaries, which account for most of its assets and businesses. The firm's American depositary shares (ADS) continued to trade on Nasdaq yesterday, and at one point showed an increase from $0.15 to $0.17. On Monday, Hibernia notified US markets regulator, the Securities and Exchange Commission (SEC) that GMAC had placed it in receivership "for a financial obligation". It stated that this obligation was GMAC's £17.25 million factoring facility. Factoring is a system of securing finance on the back of invoices and book debts. Under this system, the lender "buys" the invoices by advancing money against them. It is frequently used by businesses to guarantee cashflow.
One of Hibernia's leading brands is the Entenmann's range of cakes and confectionery. But it does not own the brand. The US-based Entenmann's Corporation has licensed it exclusively to the Irish group. The products are manufactured at a Hibernia bakery in Bridlington, England.
In August, Hibernia presented unaudited accounts showing it had €6.7 million in operating losses on the back of flat sales of €200 million in the year to March 31st last.
The figure excluded a €4.7 million charge associated with the closure of a manufacturing facility in Bristol. It sold this last month, netting a profit of €2 million.
It recently announced that it would replace chairman and chief executive Mr Oliver Murphy and chief financial officer Mr Colm Delves. Mr Stuart Anderson was named as new chief executive.
Mr Murphy and Mr Delves went to court to halt the changes.
