PAYLESS TO PAY MORE!
Choppies drag payless owner to court over P121 million debt
CHOPPIES, through its distribution centre, has dragged Payless supermarket’s majority shareholder, Saleem Malique, to court over unpaid debts.
Choppies Distribution Centre (CDC) had loaned an amount of P121 048 424.78 to Payless supermarkets. Indeed, in total, the doomed enterprise owes suppliers P1.3 billion.
It has now been deemed through the Companies Act that Payless is unable to pay the money owed to CDC.
In a recently released circular to its shareholders, Choppies confirmed it has been unable to recover the P121 million debt.
On the 13th of March this year, the High Court granted a provisional order for the winding up of Payless supermarkets and the appointment of a provisional liquidator.
A final order of the liquidation is expected to be made on 27th April, 2020.
During the liquidation process, the liquidator will, as directed by the High Court, evaluate the prospects of selling the business as a whole or individually.
As a secured creditor, Choppies has told shareholders that CDC may, if appropriate, support the provisional liquidator in operating the business in order to enable sale of the business or businesses.
Now, Choppies has taken Malique, who holds a 90 percent shareholding in Payless Supermarkets, to court after he failed to execute a deed of suretyship which he guaranteed as a surety, guarantor and co-principal debtor.
It is said Malique had committed to take responsibility for Payless supermarkets obligations to CDC, ceding and pledging his Payless shares.
After being issued with demand by CDC for payment of the outstanding P121 million, Malique reportedly failed to effect payment of such amount.
As a result, Choppies - through its distribution centre - approached the courts of law seeking judgment against Malique for the full payment of the debt as well as interest.
The company also wants Malique’s Payless shares to be attached. He was served with a summons on 3rd March.