Jamieson called to task over BasCrown

Legal Creditors' meeting revealed extent of reseller's cash troubles.

According to Shakespeare's masterpiece, Hamlet, there was somethings. rotten in the state of Denmark. If this were applied today, the playwright could do a lot worse than look to the Lancashire town of Burscough, where managing director Malcolm Jamieson based his company, BasCrown - a retailer which has left an indelible impact on the channel.

As revealed in PC Dealer (15 April), the creditors' meeting on 7 April - which was held by the administrators BDO Stoy Hayward - started the unravelling of this ball of snakes and finally began to yield some answers.

On the one hand, it became clearer where the millions of pounds allegedly disappeared to, while on the other, the future for BasCrown's MD began looking less than rosy, with a number of industry sources predicting the elusive Jamieson could face legal proceedings.

A source said: 'Legal proceedings are likely, which will mean some litigation and freezing of assets.'

In a report sent out to creditors dated 20 March, the administrators placed the blame for BasCrown's plunge into insolvency, which occurred on 5 January, on fierce competition. In terms of competitors, the report cited examples such as Dell, as well as PC World and Byte, that 'addressed the retail market aggressively, with national stores and substantial advertising'.

At no point in the report did the administrators refer to an exclusive agreement BasCrown - which traded under the name Crown Computer Products - held with Vtech Holdings, which Jamieson was quoted as saying had been a factor behind the fall of the company (PC Dealer, 14 January).

The agreement allowed the retailer to supply Vtech products to customers but, according to Jamieson, this had been thrown into confusion after the Japanese company sold its manufacturing operation and system distribution arm to PC Partners in June 1997.

But this was dismissed as 'totally irrelevant' by a Vtech representative.

It was also revealed that Jamieson's other business interests came under close scrutiny.

According to the report, the following companies - which were under the directorship of Jamieson's wife, Sharon, while Jamieson took on the role of company secretary at three of the businesses - owe large sums of money to BasCrown. These include: Computer Skills College, owing #195,579; Just Networks, owing #1,829; The Big PC Company, which owes #3,629, while BasCrown owes #39,982 to PC Partner.

Sales from BasCrown to all these companies totalled #1,143,502, while #45,070 worth of purchases from the retailer were made.

But everything always tails back to a debenture that was taken out on BasCrown on 24 October 1997 by Barkai Ltd, of which Jamieson is also a director. The importance of this debenture centres around the fact that all money owed to BasCrown will make its way back to this company.

One source asserted: 'My impression of this company is one that has been milked dry, it is now a question of seeing what can be rescued.'

What might have been a simple case of a company falling prey to the cutthroat world of the computer retail market is further blown out of the water with the revelation that a sum of nearly #1.2 million is under investigation by administrators.

First, on 28 January, The Big PC Company - of which Barkai Ltd is the principle shareholder - fell into administration with approximately #400,000 owed to BasCrown, which in the past had traded with its sibling company.

Second, during 1 August 1997 to 5 January, payments totalling #732,090 were made for accountancy, legal and consultancy charges, which has left the administrators looking into whether these payments were 'entirely proper'.

But what can actually be rescued from this debacle does not paint too bleak a picture. At the moment, a skeleton staff of 14 employees are working at Burscough Industrial Estate to cope with any Retention of Title issues, the majority of which have been resolved. Also, final stock has continued to be sold and has, up to this point, drummed up sales of #300,000.

A source said: 'In terms of asset realisation and collection, there might be the sale of The Big PC Company and Crown Computer Products' premises.' He added: 'There is also a plot of land owned by Just Networks - worth about #100,000 - and there is no money owing from it.'

But whether BasCrown and its assets will be sold is starting to look like a forlorn hope.

According to administrators, an advert for the sale of the business as a going concern was placed in the Financial Times on 9 January. However, according to the report: 'It would seem unlikely that a sale of the business as a going concern can be achieved.'

Furthermore, it stated: 'Although I have not fully discounted this possibility, a sale of the property as a fully equipped, mail-order distribution centre seems more likely.'

While the industry has finally received some clarification of what troubles were lurking beneath BasCrown, most people involved are waiting for the climax of this messy and confusing situation.

And this may well appear in the figure of Malcolm Jamieson himself - if he's ever found.