Soup maker is facing a stir in the boardroom
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Your support makes all the difference.TROUBLE is simmering in The New Covent Garden Soup Company, purveyors of cartons of vichyssoise, gazpacho and Tuscan bean soup to the chattering classes, writes Jason Nisse.
The founders of the company, Andrew Palmer and Andrew Belt, face ejection from the board at an extraordinary meeting to be held a week on Thursday. The potential ejectors are the largest shareholders, Apax Partners, a venture capitalist group headed by the US investment group Alan Patricof.
Mr Palmer and Mr Belt are to write to shareholders in New Covent Garden this week to tell them they should oppose the move, as they claim it would leave the company in the control of Apax. The venture capitalists, however, deny this.
Apax says it is the chairman of the company, Geoff Hancock, a management consultant, who is pushing for their removal.
Apax's involvement started in 1989 when the group, which had been running for three years, decided to expand by setting up a factory in a warehouse in Willesden, North London.
The founders, who had put pounds 350,000 into the company, turned to Apax for new funds and it lent pounds 800,000.
The investment was not enough, and a year later the group needed a fresh injection of cash, which Apax provided - although it was with the insistence that Mr Hancock be installed as chief executive and that Mr Palmer and Mr Belt become non-executive directors.
Since then, the other shareholders in the group have complained that Apax is effectively controlling the company and have turned to Mr Palmer and Mr Belt to look after their interests amid worries over apparent losses and a lack of financial information about the company.
New Covent Garden's last accounts were for the year to December 1990, and showed a loss of pounds 1.11m, compared with a pounds 366,000 loss the year before. The group than changed its year end to 30 June and has yet to file accounts for the 18 months to 30 June 1992. This is within the law, which allows 10 months for accounts to be filed after the year end, but it means there has been no new financial information for more than two years.
Cyril Freedman, an Apax director and non-executive director of New Covent Garden, denied that Apax was forcing the founders off the board.
He declined to comment further. 'It is a matter for the company, not me,' he said.
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