Major creditors of cash-starved Oric Products were due to get together this week to work out ways of seeing the company through its current problems (issue 75).

The current cash problems were made worse last week when Oric went to court to answer a writ from KMP, its advertising agency, claiming £200,000 in unpaid bills.

This is one of the actions that released the tide of speculation over Oric.

The court threw out a counterclaim from Oric that KMP had provided it with wrongful advice and ordered the company to pay the money it owes, along with KMP's legal costs.

It is believed that Oric owes its creditors a total of around £4million, but not all of them are as anxious as KMP to secure immediate payment.

Assembly and Automation Electronics, the company that manufactures the Atmos, is taking a sympathetic view of Oric's difficulties.

"We are fairly confident that Oric will be able to meet its debts," said Keith Arnold, A&A's Managing Director. "It is just going through a cash flow problem. There are a lot of orders in hand."

He confirmed that some of Oric's creditors were meeting to discuss ways of helping Oric out. "Most creditors are very supportive of Oric," he said.

Also involved in the discussions is Hitachi, which supplies disk drives and other components to Oric.

Andy Killick, Hitachi's product manager, said that it was: "only a very small creditor" but refused to go into any further detail.

"I would not like to prejudice any meeting that may take place," he said.

Industry analysts suggest that Oric's debts are more than covered by value of the property owned by Edenspring Investments, Oric's parent company.

But selling off property assets is something of a drastic measure to meet what may just be short term debts.

A more likely outcome is that Oric's creditors will agree to reschedule the debts so the money will not have to be paid until pre-Christmas sales start to take off.