Scottish teacake maker in lending problems
Bakery manufacturer Lees of Scotland may have to postpone an acquisition aimed at diversifying the group due to problems finding a bank to back it despite record turnover in 2008.
The maker of macaroon bars and coconut snowballs was hit by the collapse of Woolworths and banks’ risk departments continue to reject its acquisition proposal. Lees had hoped to announce the deal in the autumn of 2008 but chairman Raymond Miquel notes the company is still hoping for a solution.
The company notes in its latest trading update that the net effect of the Woolworths collapse amounted to £69,000 which will reduce the reported net profit for the year ended 31 December 2008. It also reports that, “The performance of the company’s Patisserie UK subsidiary has been disappointing in 2008 and the directors are considering its future position within the Lees Group.”