Veritas to close Nosh supermarkets
The company entered into a revised term sheet with ANZ, in relation to its banking facilities. Several undertakings and milestones as part of the agreement relate to the Nosh supermarket business.
Veritas said it has embarked on a number of initiatives to improve Nosh’s sales and profitability – also attempting to franchise the six stores currently under company ownership.
According to the company’s board, this option attracted a strong level of response and interest from potential franchisees.
“Notwithstanding this, Veritas is required under the revised ANZ facility to deliver to ANZ by 15 January 2017 either an unconditional contract for the sale of Nosh, or a proposal to close and wind down Nosh,” said chairman, Tim Cook.
Veritas is also required to close and wind down Nosh by 31 March 2017, if it cannot be sold by that date.
“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,” said Cook.
“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.”