In your interest.
Online Personal Finance Magazine
No beating about the bush.
Indage Vintners has been staring at financial losses for a long time and is not able to pay its suppliers and service providers. Now, CRP, its supplier of ‘bag in box’ packaging, has issued a warning to other suppliers not to have any dealings with Indage.
Complaints from investors and suppliers don’t seem to end for Indage Vintners; this time the problems of India’s oldest and biggest wine-maker are emanating from the UK-based CRP Print & Packaging Ltd which has warned other suppliers against dealing with Indage after it failed to honour its purchase contracts.
“Calls on the guarantee provided by Indage to CRP have not met with open dialogue, but instead a closed shop of silence. Those seeking to trade with Indage going forward or placing their critical supplies at the behest of this entity should beware,” CRP said in an email.
Officials from Indage were not available for comment.
CRP is the sole supplier of ‘bag in box’ packaging and technical expertise to Indage. CRP said it had sought an assurance from Indage to enable its continued support and partnering of the business.
Santosh Verma, managing director of Indage Vintners Ltd, had offered a parent guarantee to CRP to cover a line of credit which was provided on the clear understanding that the guarantee would be upheld if the business fails or the terms of credit are violated, CRP said. Indage’s chief financial officer, Rajesh Chalke had provided “honourable assurances that the covenant of Indage was strong and should the eventuality arise, Indage would never walk away from its responsibilities,” it added.
Indage UK has now traded insolvently for 18 months on monies borrowed under false promises from its UK and worldwide suppliers, CRP alleged in its mail.
“Management sight a number of factors, but the traits of its predecessor’s failed businesses are evident once again; no in-house financial controls or credible reporting function and no financial disclosures (FD) despite a number of appointed officials; no local management to control or run the business day to day and no working-capital facilities to support the operation,” CRP said in the mail.
CRP said the UK entity of Indage has now entered a period of voluntary arrangement supported by the UK Revenue authorities and its own group entities and creditors are “again left in a limbo and clinging to a plan that is predicated on the same honourable promises given in 2008.”
In October, Indage UK had let go of around a 100 employees; and in 2008, around 250 employees left the company after not being paid. Indage has not been making payments to its suppliers and service providers since the beginning of 2009. Soon afterwards, it stopped paying its employees, forcing some of them to approach the police.
According to an ex-employee, there is a lack of communication between Indage Vintners and its sister companies and also a lack of financial accountability. “The company lacks vision, plus it doesn’t do any market segmentation for its wines,” he said.
According to company sources, recently a lot of senior employees from the marketing and sales departments have also quit.