Financial services group needs cash'

BELEAGUERED financial services group Quyn Holdings has placed Colliers RMS on the market, a move seen as a desperate bid by Quyn to remain solvent.

Quyn auditors KPMG issued a statement in the group's financial results, saying that for Quyn to continue as a going concern it must secure additional funding.

Quyn's ability to secure additional funding has been limited by its already high gearing, which precludes further borrowing as a recapitalisation option. The sale of assets appears to be the only option to raise money.

Quyn declined to comment, citing a cautionary notice. Quyn is said to have held talks with a number of interested parties about selling Colliers. RMB Properties is said to have considered purchasing Colliers, but could not reach agreement with Quyn.

RMB Properties MD Brian Jackson said the company had tentative discussions with Quyn, but could not come up with anything firm. Jackson said RMB would look at future opportunities as they came.

Sources said the collapse of RMB talks had left Colliers' employees and other stakeholders disgruntled as RMB presented hope for the troubled property services company.

Some Colliers employees are said to have been looking forward to getting out of the Quyn stable after an association that has brought about uncertainty.

Quyn purchased Colliers from Johnnic in 1998, bringing on board the founders of the property services group Pat Flanagan and Peter Gerrard.

Flanagan and Gerrard left Colliers following a dispute with Quyn at the beginning of last year and their fortunes followed them.

Quyn's results for the year to September 30 last year showed Colliers bleeding financially. Quyn attributed Colliers' problems to financially draining development investments.

Quyn said it had launched a restructuring programme meant to restore Colliers as a property services company. This was to be achieved through the sale of noncore assets and disposal of contingent liabilities.

These included the removal of the R30m suretyship in the failed The Point project in Durban and getting rid of liabilities relating to the Benoni Lakeside Mall.

Quyn as a result reported a loss of R19,2m, compared with an operating profit of R3,9m of the previous year. Turnover was down from R111,3m to R89,5m. Net interest paid increased from R5,3m to R9,2m.

Sources said Quyn was making unreasonable demands in its attempts to sell Colliers, and that might have repelled potential buyers. Quyn's share price on the JSE Securities Exchange SA yesterday ended unchanged at 5c. It was quoted above 180c in 2000.