Receivers sent in at subsidiary of Waterglade

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The Independent Online
LLOYDS BANK has appointed receivers to Sidecar, a subsidiary of Waterglade International, the troubled property group.

The decision was made after the bank refused to write off debts of between pounds 1m and pounds 10m. Lloyds refused to reveal the exact extent of the loans.

The debt was secured by four properties, a mixture of offices and retail space, according to Morris Whithall of Grant Thornton, the receiver. 'We do not like writing off large amounts of money,' a spokeswoman at Lloyds said.

Waterglade shares were suspended earlier this week as news of the negotiations reached the market. The move is a setback for new management installed by investors last month after a savage battle for control ended with the departure of the entire board under the former chief executive, David Cunningham. When rebel shareholders led by Wilson Ng, the Singaporean former merchant banker, ousted the board, Mr Cunningham left with a pounds 128,000 pay-off.

The new directors of Waterglade said they would continue to work towards clarifying the viability of the company as a trading entity and expected to be able to make a further announcement by noon on Wednesday.

Waterglade's profits turned to losses during the recession. Debts reached pounds 55m in 1992. It was targeted for takeover by several financiers before Mr Cunningham took over.

London Merchant Securities, the property company, agreed to swap the ownership of a building Waterglade sub-let to Euromoney for a 10 per cent stake. Mr Cunningham then prepared for a rights issue to reduce borrowings of pounds 18m. The issue ran into trouble when details were mistakenly sent to market-makers before the launch.