FLYING Brands, the former mail order company in which Ayrshire entrepreneur Sir Tom Hunter holds a 27 per cent stake, is being taken to court by a business partner in Australia.
Flying Flowers Australia (FFA) claims that Jersey-based Flying Brands breached the pair’s contract when it sold its gifts division. The gifts unit was sold as part of a restructuring instigated by Hunter, which involved disposing of the loss-making group’s operating subsidiaries and turning it into a cash shell.
Paul Davidson, chairman of Flying Brands, said: “The group denies breach of contract and has defended vigorously these claims and raised its own counterclaim against FFA for FFA’s failure to pay monies contractually due to the group.”
The firm last night declined to give any further details over the nature of the contract.
Davidson said Flying Brands was also still in discussions with Jersey Choice Marketing, which has threatened to make a warranty claim after buying the group’s Gardening Direct unit.
His comments came as the group narrowed its half-year losses to £435,000 in the six months to 28 June from £1.1 million in the opening half of 2012.
Chief executive Stephen Cook has agreed to shift from full-time to part-time hours.
Hunter mounted a takeover bid for Flying Brands in 2008, which proved unsuccessful. He is understood to have written-off his investment in the company.
The group’s only asset is Retreat Farm on Jersey. Davidson said the directors are still mulling their options for the site, but hinted they may apply for planning permission to redevelop it.