BusinessBusiness RecoveryWrapit directors loaned £150,000 before collapse

Wrapit directors loaned £150,000 before collapse

Directors of Wrapit extended loans of £150,000 before the firm went into administration earlier this month.

Directors of failed online wedding list company
Wrapit are thought to be
among the creditors of the company, having loaned it £150,000 before the company
went under.

The company’s latest available accounts show that the directors had loaned
£450,000 the previous year, but the company said this week that those loans had
been repaid in May of 2007.

Managing director Peter Gelardi added that the directors extended a further
£150,000 in August 2007 to help the company over the slower autumn period, which
has not been repaid.

‘[When the loans were repaid] at that point there was nothing wrong with the
business. If we had wanted to reduce our exposure we wouldn’t have put in any
loans,’ he said.

He added that he, together with finance director Nigel Taylor and director
Nicholas Haimendorf, had also signed personal guarantees totalling £300,000.

Gelardi believes the company could have survived despite credit reference
agency
Graydon
UK
describing it as ‘technically insolvent’ for a number of years.

‘The company has a negative net worth, but it didn’t make the company
insolvent.

‘At the time we were in negotiations with financiers to provide the
additional funding required which we thought would be forthcoming,’ said
Gelardi.

He said other financiers pulled out when HSBC, which ran Wrapit’s online
credit card payments, held back on nearly £1m of funds.

The bank denied it was responsible for the company’s failure. ‘HSBC believes
it has done all it can to assist the directors. Any suggestion that HSBC is
responsible for Wrapit’s problems is absolutely refuted,’ said a statement.

Administrators KPMG
said Wrapit’s net debts are in the region of £6.5m. HSBC is owed £3.2m.

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