Saggio Group, a star of the Asian market since it was founded by Paul Chin in 1992, looks set to cease operations after the board of directors decided the business was no longer viable.
Saggio Hong Kong (SHK) and Singapore (SSG) are being run by turnaround and reconstruction firm Ferrier Hodgson while Saggio Malaysia (SMAL) and Taiwan (STWN) have gone under.
A statement to OPI from Saggio Holdings said: "Due to substantial losses suffered by Saggio Group, the board has considered that the operations of Saggio Group will discontinue. STWN and SMAL decided it is no longer commercially viable to maintain operations and cessation of business would be in the best interest of all relevant parties."
It adds: "The cessation of business of Saggio Group [owed] to substantial accumulated losses without the prospect of a breakeven operation in [the] reasonable future."
Ferrier Hodgson’s George Wong told OPI that it is running SHK and sees the finding of a buyer as the best way to ensure its future. However, Saggio Holdings’ statement said: "When the respective receiverships have been completed, it is also expected that the operations of SHK and SSG will discontinue."
It is believed that failure to pay back a debenture issue of HK$10 million in July sealed Saggio’s fate.
Meanwhile STWN told customers that it had ceased operation in a letter.
It said: "Under these extreme circumstances, Saggio must give up the partnership we had with your company. Concerning orders that haven’t been delivered, we won’t be able to deliver these products to your company."
Staff at Saggio have also filed a case with the Hong Kong Labour Department to get salaries owed. However, the Saggio Holdings’ statement said: "Staff wages and severance payments of STWN and SMAL would be a priority."
It added that the receivers would handle staff issues in Hong Kong and Singapore "including payment of wages to staff according to their respective statutory requirements." (see ‘fallen star’, page 32)
Hong Kong (CHN)