Veritas Investments has kicked off legal proceedings against Gosh Holdings, buyer of Nosh supermarket, for late payments.
Veritas has said Gosh Holdings, which has since renamed itself Nosh Group, consistently failed to meet the payment schedule and therefore breached the sale and purchase agreement.
Chairman Tim Cook said the failure to pay Nosh’s creditors was a breach of the sale and purchase agreement, and that the group owed just under $69,000.
“We entered into this transaction in good faith after a rigorous process and it is extremely disappointing that the directors of Gosh Holdings Limited (now Nosh Group Limited) have clearly failed and continue to fail to meet their financial and legal obligations.”
"When Veritas originally purchased Nosh, Veritas committed to meet all creditors' payments, which amounted to $3.9 million, and honoured this."
It has been a bumpy ride from the start for Veritas, which took on a $5 million funding line with ANZ Bank New Zealand to buy the Nosh stores in 2014.
The group struggled to turn the gourmet supermarkets into a profitable business and compete against thriving Farro Fresh.
It was given a deadline by its lender to get rid of the business to keep in the bank's good graces.
At least four Nosh stores have recently closed temporarily, according to the NZ Herald. A notice stuck to the Dominion Rd store says low stock has forced a closure and customers can expect the store to be opened on June 26.