The on-again, off-again relationship between Korvettes Inc., the ailing discount chain, and its major lenders is under new strain after the company failed to come up with a $26 million cash payment the banks said was due last Friday.
Korvettes owes a total of $55 million to three banks -- Chase Manhattan, Bankers, Trust and Manufacturers Hanover -- and to the Prudential insurance Co.
The chain's French parent, the Agache-Willot Group, killed one agreement that had been reached between the discounter's creditors and Korvettes two weeks ago.
That action not only brought the wrath of the lenders, it also prompted Joseph A. Ris, chairman since last spring, to resign. But when the banks seized the $6 million Korvettes had on deposite the chain quickly enticed Ris to return and claimed the whole episode had been a "misunderstanding."
Ris then renegotiated a new deal with the lenders -- one that called for a heavier up-front cash payment, but no share in future profits of the chain as the original deal proposed.
Korvettes said today that there never had been any intention of making the payment last Friday, but that the chain had hoped to get approval of the French government to transfer the $26 million to the United States by Friday.
An official of one of the banks disagreed.
"They were supposed to pay last Friday," he said. But "the lenders walked in and were told the company didn't have the money."
"A deal is a deal," said one banker. The bankers and officials of Korvettes are supposed to meet again Wednesday.
On one point the leaders and Korvettes agree: the French central bank, which must approve all large-scale transfers of funds out of France, has yet to give it permission for the transaction.
"We hope we'll get the approval this week,' a spokesman for Korvettes said.
He said that the $26 million is in Agache-Willot accounts in France ready to be sent to the United States.
Even though Korvettes owes $55 million to the three banks and insurance company, the lenders agreed to accept $26 million now and another $2 million early next week. In return, the banks will release the $6 million of deposits that they seized when Agache-Willot killed the original agreement. That agreement stipulated that the company would pay about 45 cents on the dollar and give the banks a 25 percent share in any future profits through 1987.
Korvettes, the original discount chain, has fallen on hard times in recent years and suppliers have been reluctant to ship merchandise to the chain. Agache-Willot has promised that all past-due bills of supplies will be paid in cash.
Even so, suppliers said they are less than willing to make any more shipments to Korvettes and several said the latest confrontation between lenders and the discounter does not help relieve their apprehensions.