Airtours sues former owners of Aspro
Tuesday 01 March 1994
The company yesterday issued a formal notice to the Stock Exchange, following reports in the weekend press.
It said: 'Airtours has commenced proceedings against George, Christopher and Dimitrios Asprou, the former owners of 90 per cent of the issued share capital of Aspro Travel.'
The claim, it added, was being made on 'the grounds of fraudulent misrepresentation at the time of the acquisition of the trading position of Aspro and its wholly owned subsidiary, Inter European Airways.'
Airtours is also claiming against all of the former shareholders of Aspro under warranties and representations contained in the purchase agreement.
Initial investigations, carried out by independent accountants, estimate the claim to be pounds 9.8m.
Grant Thornton, chartered accountants and auditors to Airtours, acted for the company when it bought Aspro. Touche Ross handled the independent investigation.
Airtours' statement yesterday followed its move last week to obtain a freezing order on pounds 12.6m of interest- bearing loan notes paid to the three Asprou brothers.
The City was wrongfooted by yesterday's events. Airtours shares fell 13p to 540p.
Some analysts criticised the way in which Airtours chose to disclose the problems with Aspro. One said: 'They should have spelt it out in the annual report and accounts.'
Airtours said its accounts for the year to September 1993 fully reflected the shortfall against the level of profits previously expected from the acquisition.
It does not say what the shortfall was, but two notes in the report allude to problems at Aspro.
Note 1 on page 28 shows that Aspro made a profit of only pounds 6,000 in July, August and September last year - the peak months for travel companies. Note 10 on page 34 shows that Aspro lost pounds 9.44m in the previous eight months.
It is understood that Airtours was expecting Aspro to produce pounds 4m of profits for 1992/3.
Airtours declined to comment on this but said that the earnings and assets of the current financial year would not be hit.
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