VnC Cocktails founder Shane McKillen quits Veritas board

Tuesday 16th September 2014

Shane McKillen, founder of failed pre-mixed drinks company VnC Cocktails, has resigned from the board of Veritas Investments, the listed food and grocery investor, to focus on other business commitments.

McKillen joined the board following the company’s acquisition of the Mad Butcher chain in May last year, Veritas said in a statement. His resignation to “concentrate on other business commitments” comes after VnC Cocktails went into liquidation earlier this month after failed attempts to sell it.

Veritas chairman Mark Darrow declined to comment on whether McKillen had quit to deal with VnC Cocktails' liquidation.

"He's got numerous interests, and that is obviously one of them, but it was his choice to retire and we've accepted that and thanked him," Darrow said. A replacement board member would be appointed at the company's annual general meeting, he said.

Darrow had been a director of several of McKillen's companies now in liquidation, including, VnC Cocktails, Sejuice Wines and Hydr8, but quit them in June this year, according to documents on the Companies Office.

McKillen founded VnC Cocktails in 2007 and its profile rose in 2011 when it featured on reality television show 'Keeping up with the Kardashians' as the drink of choice of Kourtney Kardashian's husband Scott Disick, who was a brand ambassador for the company.

The business ran into distribution troubles and was put up for sale before going into voluntary administration on June 30, and subsequently tipped into receivership a few days later by secured charge holder Bank of New Zealand. It was put into liquidation following a creditors' vote this month.

The final report from administrators Paul Sargison and Simon Dalton, who have since been appointed liquidators, said while a sale of the group had been negotiated, it had not yet settled and would not see the first security holder fully repaid. Little or no funds would be available to other creditors, it said.

The administrators report said VnC Cocktail's secured creditors were owed just over $17 million and unsecured creditors some $2.4 million. The estimated deficit from that company alone was $8 million, excluding the costs of administration and liquidation. The holding company's assets included $7 million of related party lending. Administration fees for VML, Hydr8, and Sejuice total more than $38,000 in the latest report.

McKillen was also one of the original investors in 42 Below Vodka.

Last month, Veritas entered into a conditional agreement to buy gourmet-supermarket chain Nosh Food Market for $1.77 million. The NZX-listed investment company bought Mad Butcher business in May 2013 in what was effectively a reverse listing, having sold its assets and returned capital to shareholders. In December it acquired half of Kiwi Pacific Foods for $2.8 million in cash and $400,000 in shares at $1.38 apiece, with potential earn-outs if certain export targets are met. The remainder of the business is owned by Antares Restaurant Group, which holds the New Zealand Burger King franchise.

In August, Veritas reported annual profit rose to $4.3 million in the year ended June 30, from a loss of $847,000 a year earlier, as Kiwi Pacific Foods made up for slower than expected sales at the butchery business. It declared a final dividend of 4.22 cents, bringing the full year payout to 8.16 cents per share, payable on Sept. 26.

Shares of Veritas were unchanged at $1.16 and have declined 17 percent this year.

BusinessDesk.co.nz

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