Renaissance has taken legal action against Exeed over the alleged holding of over $800k following the sale of its distribution company.
The former IT distributor released an official statement by Chairman Colin Giffney on behalf of the board this morning, saying since settling the deal on July 18, “funds of $837,373 had been withheld by Exeed.”
At the time of the deal Renaissance received funds of $4.3m for its distribution division, with the above sum moved into a solicitors trust while the companies settled “the final value of the inventory sold to Exeed, claimed breaches of warranties by Renaissance (which Renaissance absolutely refutes), the amount of accrued leave payable to Renaissance’s employees who transferred to Exeed, and provision of certain business records to Exeed.”
As the majority of funds were placed in a solicitor's trust account pending resolution, Renaissance says management on both sides engaged with goodwill but notes on several occasions ‘we were advised that management had agreed but on each occasion the agreement was refuted.’
At the time of the agreement, a statement Renaissance read:
"Renaissance is comfortable with its legal position, and expects that the above matters will be resolved to its satisfaction.”
Yet the company claims the position with inventory has been agreed, though disputes to the value of approximately $400,000 concerning alleged breaches of warranties by Renaissance, sick leave/long service leave, business records and fixed assets have not been able to be resolved.
Concluding the statement, Giffney says “regrettably, Renaissance has today instructed its solicitors to commence legal proceedings against Exeed.”
The news comes over a week since former CEO Shaun Rendell left the company to join Kordia as its new CFO.
Rendell leaves his role with the former Apple distributor two months after agreeing to sell its IT distribution business to Exeed, with his final day this coming Friday on August 31.