Price Club director, Victor Zammit, yesterday refuted speculation that the supermarket chain is in serious financial difficulty.

But speculation surfaced Friday evening when news emerged that an urgent creditors' meeting had taken place and that the chain was to offer creditors equity shares in a potential Malta Stock Exchange equity listing in return for debt cancellation.

However, when questioned on the matter yesterday by MaltaToday, Victor Zammit rebutted such claims by explaining, "The Price Club is not in difficulty. It is true that a creditors' meeting was held last [Friday] night and everything is now back to normal.

"They [the creditors] wanted to ensure that monies owed are secure."

However, Mr Zammit refused to comment on whether creditors had been offered equity shares in an eventual Price Club stock market listing.

While stores belonging to the Price Club chain are renowned for high-turnovers, one creditor contends that the problem lies in management.

He explains that the chain, instead of paying off its suppliers, chooses to utilise funds for further expansions to the chain.

Other creditors told MaltaToday:

"The Price Club is symptomatic of the financial crisis in the country. People have grown too fast and they are over-trading. The Price Club undercut prices. In many cases they would be selling products at a cheaper price that were sold to them."

"Creditors and banks have finally woken up to the realities facing such operations."

The chain was recently extended through the opening of two more stores - one in Attard and another in Naxxar following the purchasing of the localities from Happy Savers Supermarkets in deals that involved considerable sums of money.

Meanwhile, seven sites in Tripoli have been allocated to the chain, which is expected to open eight new stores in Libya, seven in the capital city and another in Benghazi.

The Price Club Supermarket chain is also expected to further expand its business in Malta with a Lm3.5 million investment earmarked for Save-On supermarket in Marsa.

Work on the project was scheduled to begin by the end of last year but Planning Authority permits are reportedly yet to materialise.

The new store is set to be the company's largest retail outlet yet, on a bigger scale than the Swatar premises which is believed to be the biggest and busiest supermarket on the Islands.

The Price Club example appears to be similar to many other businesses. The main concerns are that the number of retails outlets has eaten away the competitive edge of many companies. Others facing credit facilities with their banks have resorted to mass bartering and this has attenuated the cash flow problem facing the country at present.