Iceland has come under scrutiny for allegedly transferring substantial amounts from its Irish division before its sale.
- Metron Stores, the owner of Iceland Ireland, has raised concerns over financial transactions prior to the acquisition.
- A letter highlighted the removal of over £1.37m and £772,476 from company accounts in a single week.
- Unpaid debts amounting to £2.23m were reportedly left unsettled despite prior agreements.
- Iceland responds by asserting that all normal trade debts were settled by Iceland UK by the time of sale.
Iceland has recently faced allegations concerning its financial activities ahead of selling its Irish division. Metron Stores, which owns Iceland Ireland, has reportedly sent a letter to Richard Walker, Iceland’s executive chairman, expressing serious concerns about significant financial transactions that allegedly occurred before the completion of the sale. Metron’s letter cites more than £1.37 million as transferred out of the company’s accounts. Additionally, they claim that another £772,476 was moved from sales in the week between signing the deal and its completion.
Moreover, Metron contends that a debt of £2.23 million remained unpaid, contravening the terms of the agreement which, according to Metron, stated that all outstanding debts would be cleared before the deal was finalised. According to their claims, the sums that Iceland transferred out would have sufficed to settle these outstanding debts.
In response to these allegations, Iceland has reportedly considered pursuing a defamation claim against Metron, arguing that the correspondence was an attempt to malign its reputation. An Iceland spokesperson has been quoted asserting that all typical trade debts of Iceland Ireland were settled by Iceland UK up to the date of the sale, and employees were compensated in full.They further justified the transfer of funds as constituting revenue that rightfully belonged to Iceland UK.
These developments come at a time when Metron Stores has entered examinership, akin to administration, in June, burdened by debts totalling £30.9 million. This context adds layers of complexity to the financial dispute, potentially influencing the legal and financial outcomes for both parties involved.
The ongoing financial dispute between Iceland and Metron highlights significant challenges in corporate acquisitions, particularly in financially distressed contexts.
