Insolvent chocolate maker Highgate Foods failed to excite investors, leaving its assets unsold after a March 15 auction by DC Tavares and Finson.

Jamaica Redevelopment Foundation Inc. (JRF), owner of Highgate's debts under mortgage, cold-shouldered the bids because none of them met the 'reserve price', that is, the lowest possible offer on which the bad-debt collector was prepared to deal, according to sources.

The confectionary is about $300 million in debt, $200 millon of which is said to be bad loans. "The location is bad," said a Wednesday Business source close to the parties. "It's too isolated."

Highgate Foods is sited in St Mary, one of Jamaica's poorest and fifth-smallest parish with a population of some 113,000.

At one time, the factory was ringed by cocoa farmers from whom Highgate sourced raw material, but those plots have disappeared. In the run-up to the JRF's takeover of the company last year from Claude Clarke, the factory was said to be largely dependent on imports.

Back to the board

On Monday, Tavares and Finson said the matter of the sale - the auction was related to the factory buildings, comprising 42,657 square feet, and the 4.12 acres of land on which they sit - was back in the hands of JRF.

Attempts at comment from Janet Farrow, who runs the Beal Bank subsidiary, were unsuc-cessful. It is understood that JRF's next move is to dispose of the capital equipment.

"We're now making an attempt to sell," Wednesday Business was advised by sources. "We're moving to advertise the different pieces."

There are well over 100 pieces of machinery and equipment, the most valuable of which is said to be the packaging equipment, but there are doubts that it will find a buyer.

Optimism had been low from early in the game that an investor willing to take on Highgate Foods as a going concern would emerge. Up to last month, the unions were still hoping for a suitor, saying the community in which it sits had few other job propects. To them, Highgate Foods was a big operator.

Talks were initiated with Desmond Blade's Musson Jamaica group, who held the distribution contract and to whom Clarke had been looking for equity to help save his company, but Blades caught JRF and its appointed receiver Ken Tomlinson off guard when he laid claim to their bargaining chip, the Highgate Chocolate trademark.

Paul Scott, who runs Facey Commodity, a member of the Musson family, said Tuesday that they were looking to relaunch the brand later this year, but was yet to decide whether it build its own factory or contract a confectioner to produce the chocolate under the Highgate name.

He had planned initially to have the chocolate back on the market by Easter, but has pushed back that deadline to later this year.

Mussons, said Scott, was not among the bidders for the assets auctioned by Tavares Finson, having determined that the investment "didn't make sense" for the company.

business@gleanerjm.com