WATERFORD CRYSTAL chief executive John Foley became the latest boardroom casualty of the company’s current crisis when he resigned from that post and the board yesterday.
Waterford Wedgwood’s banks took effective control of the luxury crystal and china manufacturer last week when they appointed a receiver. The group has a deficit of €336.9 million. New York-based private equity fund KPS Capital Partners last week wrote to the receiver stating it is interested in buying the group as a going concern. Talks are ongoing.
Yesterday, Mr Foley resigned as chief executive and stepped down from the board of Waterford Wedgwood, which is the crystal manufacturer’s parent.
His departure follows those of a number of directors last week, including non-executive chairman Sir Anthony O’Reilly, who owns 52 per cent of the overall group with his brother-in-law, Peter Goulandris.
The fallout for the group continued yesterday when Moody’s, the international agency that rates companies’ ability to pay debts and meet their liabilities, withdrew its rating from Waterford Wedgwood as a result of its being placed in receivership and failing to pay the coupon (the interest or dividend) on a €116 million loan.
KPS Capital Partners is set to meet Minister for Enterprise, Trade and Employment Mary Coughlan today to discuss its plans for the group.
The meeting was due to take place yesterday, but had to be postponed. KPS is also due to meet representatives of Waterford’s trade union Unite this week.
The Government has also had talks with trade union representatives in an effort to find a way of dealing with the pension crisis faced by the group’s 800 Irish workers.
Waterford Wedgwood’s pension has a €111 million shortfall.
If the company were to be wound up, existing and deferred beneficiaries would be paid from the fund, but workers who are contributing to the scheme would be likely to lose out.
KPS specialises in buying manufacturing businesses that are insolvent or bankrupt or have heavy debt burdens. The firm is one of more than 10 potential bidders which contacted receiver David Carson of Deloitte last week.
Mr Carson’s primary role is to protect the interests of the banks that appointed him. He said last week that he intended running the business and selling it as a going concern.
Sir Anthony and Mr Goulandris invested €400 million in their stake in Waterford Wedgwood. Sir Anthony has also personally guarranteed some of the group’s debts.
The banks placed Waterford Wedgwood in receivership following the failure of efforts to attract a buyer for the group.
Its brands include Waterford Crystal, Wedgwood and Royal Doulton china and Rosenthal porcelain.
