Johannesburg - Infiniti Technologies, the flailing information technology (IT) company, had its fate sealed yesterday as its second banker, Standard Bank, served papers to inform the company that an urgent application had been made for its liquidation.
This move follows the news last week that FSA Distribution, an Infiniti division, would be liquidated after an application from one of its creditors, Reichmans. Nedbank in turn withdrew Infiniti`s banking facility.
A Standard Bank spokesman said Infiniti had stopped trading entirely. While the bank had no exposure to FSA, it did have exposure to another division, Corporate Hardware Specialists, and legal obligations to the non-trading HNR Computers and Infiniti Technologies.
Standard Bank`s exposure could be about R12,5 million.
"It is sad," the spokesman said. "If the FSA sale for R30 million had gone through it would have kept the business going, but as it is, Standard Bank`s exposure is not huge and part of the normal course of business."
The sale of FSA to Drive Control could have taken Infiniti out of its debt hole as long as the underlying businesses were solid, but Standard Bank said market conjecture might have put an end to the deal and alerted the buyer to the serious problems in Infiniti`s business.
It was possible that after the liquidation the bank could recover about 50 percent of its exposure, but Standard Bank said it hoped it would be more.
Infiniti`s interims for the period to February 28 showed R37 million owing in interest bearing debt, which was a 326 percent increase over the same period last year.
Another subsidiary, Integral Support Services, had an individual creditor exercise his rights of a pledge and session of his shares last week.
Standard Bank said there was still scope for an "offer of compromise" from outside parties interested in cherry picking any worthwhile parts of Infiniti`s business. Any buyer wanting to do so would, however, have to give good reasons to the liquidators and creditors for the plans.
The spokesman said FSA had good Hewlett-Packard and Microsoft agencies that could be attractive to other parties. As yet, he did not know of any offers.
Infiniti`s listing was suspended on the JSE early last week.