Nosh grocery chain sold for $4m

Nosh Supermarket in Ponsonby, Auckland. Photo / File

NZX-listed holding company Veritas has sold its upmarket grocery chain Nosh to Gosh Holding for $3.98 million

In a release to the NZX, Veritas chairman Tim Cook said the purchaser agreed to assume Nosh's trade creditor liabilities under the transaction, which includes roughly $1m worth of stock.

The net sale proceeds will be used to repay Veritas' debt to ANZ.

Shares for the company rose by 20 per cent ahead of the announcement, up to 18 cents from 15 cents, making them the fastest gaining shares on the NZX for the day.

However, a very small volume of shares was traded - just 4500, worth $810.

Earlier this week Veritas was granted another extension to sell the unprofitable grocery chain.

The company announced a further extension on the NZX on their deadline of January 31.

The Herald reported in November that Nosh franchises had gone up for sale.

Veritas originally agreed with ANZ to unconditionally sell Nosh with an original deadline of January 15 or wind the business up.

ANZ agreed to extend the deadline to the end of the month after which Veritas said in a statement to the NZX that they had "received a number of approaches from potential purchasers of Nosh" and that the board was "in discussions with several parties in relation to a potential sale of Nosh."

Veritas chairman Tim Cook refused to comment today.

The owner of the Nosh franchise on Constellation Drive in Auckland's Mairangi Bay has dropped the Nosh brand from its store.

Veritas said the franchisee has indicated that he will operate independently of the Nosh franchise and "has purported to terminate its franchise agreement. Veritas does not accept that termination, and the parties are in dispute over the matter."

Veritas took on a $5 million funding line with ANZ to buy the Nosh stores in 2014, but has struggled to turn the gourmet supermarkets into a profitable business. It had set out plans to franchise the business in recent months.

Gosh is owned by Sydney-based Andrew Guy Phillips, its sole director and shareholder, according to Companies Office records. It was incorporated this morning at 11:23 am.

- With Businessdesk