Ethan Adams hits crisis point

Coalville distributor Ethan Adams & Associates is facing liquidation after falling foul of networking vendor Attachmate with debts of #300,000.

The distributor, which has held an exclusive trading agreement with Attachmate for five years, was forced to cease trading at the end of September.

Ethan Adams, which was established 11 years ago, was inherited by Attachmate after the vendor acquired US company Kea Systems in 1993.

John Morgan, channel manager at Attachmate, said Ethan Adams began facing financial problems with the vendor more than 12 months ago when credit lines were extended to get accounts back on an 'even keel'.

Morgan said: 'Ethan Adams was in excess of its credit limit and was scheduled to try to get within the limit through a series of payments.'

He added Ethan Adams had defaulted on some of its payments, but Attachmate had looked at providing continual funding for the distributor to move out of debt.

Bob Bailey, senior partner at Price Waterhouse Coopers' East Midlands branch, which is representing the distributor, stated a date of notice was served to its creditors at the end of last month.

He added: 'The legal status of the distributor is that there is no form of insolvency at the moment, but it is fair to say it will go into liquidation at a creditors' meeting scheduled for 13 October.'

The distributor had sustained losses in its results for the year ended 31 March 1997, as pre-tax profit fell from #287,000 for the previous year to a loss of #333,000. Sales for the period was undisclosed but believed to be less than #2.8 million. Its previous turnover for 1996 was #3.6 million.