TROUBLED jewellery firm Abbeycrest said it is not repaying the first instalment of a loan after talks on postponing it collapsed.
The Leeds-based group, which has been hurt by the high price of precious metals, took out a loan in May with Moorgarth Property Investments after terminating the leases on its former head office and car park in Leeds.
Abbeycrest had been due to repay the first instalment of £311,400 at the end of last month.
“In light of continuing challenging trading conditions, the company has in recent weeks been in negotiations with Moorgarth, with a view to agreeing a rescheduling of the repayment profile,” said Abbeycrest. “Moorgarth has, throughout this period, provided the company with written confirmations temporarily postponing the requirement to repay the first instalment. Following termination of these negotiations yesterday, the company has informed Moorgarth that it will not now be making the payment of the first instalment on October 21.”
The company said it is able to do so because of an inter-creditor agreement in May, between Abbeycrest, Moorgarth, senior lender Burdale Financial and others.
“Moorgarth is unable to take any action to recover the £311,400 without the prior written consent of Burdale, which has not been given,” it said, adding Burdale remains supportive.