Meetings leave doubt over Inter Link's debts
Published:  27 July, 2007

There was mounting concern this week among the creditors of the now-defunct Inter Link Foods as it emerged that they might not have their debts met in full by new owner McCambridge Food Group.

The Irish baker, which bought Inter Link moments after it went into administration on Friday, held a succession of one-to-one meetings with suppliers earlier this week, which revealed that some of the £10 million sitting on suppliers' books might have to be written off.

One, who described himself as a 'substantial creditor' phoned to voice his concerns to British Baker. He commented: "We thought we were okay when we got the phone call on Friday. We went up to see the new people, only to be told that they didn't buy the debt. They expect us to continue to supply them."

Another major supplier said that it had been trying to contact senior management at McCambridge since hearing that the deal had gone through but had not received any communication from either the company or the administrators.

British Baker understands that while shareholders stood to make nothing from the £63 million-plus deal - most of which went to writing off bank borrowing - suppliers thought they would not lose out.

Inter Link dwarfs McCambridge's previous turnover of £32 million by some £100 million and increases its workforce from 1,000 to 2,700. Chief executive Michael McCambridge agreed it was a case of a minnow swallowing a whale, but he declined to comment on transactional details or how Inter Link, which had been driven to administration by distribution problems and poor margins, would be brought back into profit. In a statement, the company said savings would not be made through the workforce, at least 90% of whom would be retained.

Despite seven years of steady acquisition in the UK and Ireland, which has swelled its portfolio of food companies by nine, McCambridge has maintained a low profile. The purchase of Inter Link, which brings with it 11 manufacturing sites, including its first European base in Poland, propels it on to the world stage.

Former Inter Link chairman Jeremy Hamer who, with fellow directors Ian Croxford and Colin Davies, has resigned, said: " A lot of what we were doing has got to be right for them. You have to operate efficiently, buy as well as possible and maximise sale price."

He declined to comment on details of the sale.




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