Distributor Storage Options and Supplies has gone into liquidation, owing an estimated #600,000 to a number of channel players. John Alexander at Pannell Kerr Foster was appointed receiver.
Alexander Bell, the managing director of the company, and a former Ideal Hardware employee, started the company in 1994. After only six months, he signed a deal with VLSI International, which took a 40 per cent equity share in Storage.
In its 1995/1996 financial year, Bell said that the company incurred bad debts of #120,000 and the theft of #50,000 by a former sales manager.
Now, according to the creditors? list, VLSI is claiming it is owed #150,000 and has a debenture on Bell?s house.
Other channel players that are also owed money include Ideal Hardware (#18,168); memory distributor Dane-Elec (#18,579); Northamber, owed #6,810; Lion Computer Distribution, owed #20,309 and Micro Computers, owed #24,780.
According to one of the creditors who attended the winding up proceedings today, the meeting was stormy. Bell was closely questioned by a representative from Ideal Hardware, who wanted details of the company's exact relationship with VLSI and who questioned whether the company was incorporated properly.
He questioned whether Storage had a company secretary - if not, Bell could be personally culpable for the debts, he suggested.
According to Bell, VLSI initially provided a credit facility of up to #250,000 and increased that to #375,000 in May 1996. Bell lost #100,000 of Dram memory chips in a ram raid this February, and the following month, Microsoft stopped Storage from selling its software. That had made the company?s cash flow difficult.
A flood in June this year meant stock worth over #30,000 was damaged and next month Storage?s remaining stock was moved to VLSI?s premises.
There will now be an official investigation by the auditor into the affairs of the company. Bell, at the creditors? meeting, agreed to sign an affidavit saying that VLSI told him to buy stock that is still unaccounted for. A representative from VLSI said that, while his company had taken over warehousing from Storage for a period of six weeks, it had not received a penny.
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