Veritas Investments has agreed to sell its Mad Butcher franchisor business to chief executive Michael Morton for $8 million, less than a quarter of what he sold it to the food and beverage investor for in a reverse listing almost five years ago.
Auckland-based Veritas has entered into a conditional deal to sell the business to Yogg Ltd, which is owned by Morton and his partner Julie Leitch - business founder Sir Peter Leitch's daughter - for a gross consideration of $8m, it said in a statement.
That includes an amount to discharge Veritas' trade creditor liability and the balance will go towards repaying ANZ Bank New Zealand, which has effectively been overseeing a wind-down of the business to claw back as much of the $28.5m the lender's owed.
The deal is subject to shareholder approval given it will change the nature of the business by leaving The Better Bar Co as the sole operating unit, and because the value of the deal is more than half Veritas' average market capitalisation, which was recently $2.4m.
Veritas hired Bancorp Corporate Finance to manage a sale process for the meat franchisor business and attracted three bids. Morton declared his interest in October and was excluded from board discussions on the sale.
