SHAREHOLDERS in Cambridge, the leasing group that went into receivership three years ago, have formed an action group and are seeking to recoup their losses. The group is considering taking an action for damages against the banks that put in the receiver, according to the group founder, Mr Paul Mackay, a Dublin chartered accountant and Cambridge shareholder.
The group, Cambridge Action Group for Equity (CAGE), claims that Cambridge's 13 banks acted hastily in appointing a receiver to the company, which made losses of over £35 million in 15 months to the end of May, 1993. The main banks, including Bank of Ireland and Ulster Bank, were owed £80 million and appointed Mr Tom Grace, of accountants Price Waterhouse, as receiver in September, 1993.
Mr Grace has succeeded in recovering almost all of the Banks money said Mr Mackay, who based his assertion on the six monthly reports that Mr Grace was required to file with the companies office. However, the shareholders are unlikely to receive any money as a result of the receivership, he said.
Cambridge was floated on the stock exchange at 56p per share and reached a high of 78p in 1990, before slumping to just 3p, ahead of its collapse.
CAGE claim that Mr Grace should not have been appointed and that "at worst an orderly winding down of the business and the loan books should have been undertaken".
The receivership and other consultancy work carried out on the behalf of the banks has cost £4 million to date, which has had to be met out of the proceeds of the receivership, according to Mr Mackay Cambridge became a significant force in the leasing sector, particularly after the British venture capital company, Elektra Kingsway, invested £10 million in Cambridge in early 1992 the action group said. Elektra is unlikely to see any of its money returned.
Cambridge was set up as a leasing company in 1987 by Mr Colm Menton and expanded into financial services before floating on the stockmarket in June 1989. In May 1993 the company made the surprise announcement that it would make significant losses for the year to February 1993, due mainly to problems in its confirming division.
In June 1993 Mr Menton resigned from the board long with his bother Kevin and other directors, Mr Conor Hanratty and Mr Liam Booth.
In September the group announced losses of £35.4 million for the 15 months to the end of May on a turnover of £50 million shortly afterwards the banks appointed a receiver.
None of the former director are involved at this stage according to Mr Mackay, although they were substantial shareholders.
