Birrane's motor-racing outfit Lola hits the skids after UK tax dispute
Mayo tycoon Martin Birrane's motor racing firm Lola Cars International has gone into administration after cashflow problems relating to a dispute with the UK taxman.
"The latest economic downturn and the decision of Her Majesty's Revenue Commissioners not to pay ongoing R&D tax credits has caused a serious cash-flow problem for the businesses," according to a company statement.
"It is with enormous regret that a decision has been taken to issue notices of intention to appoint an administrator to Lola Cars International Ltd and Lola Composites Ltd.
"This step allows the board to continue its discussions with possible investors and prospective purchasers with a view to securing the best outcome for the staff, creditors and customers of both businesses. The Lola board have declined to make further comment until Monday 21 May."
Sales at the company fell 17 per cent last year as the downturn bit hard. Birrane, who holds the Irish land speed record, having driven at 176mph on an unopened part of the M50 in 1990, has ploughed huge sums into the car engineering business, which also diversified into hi-tech composite materials.
Lola was involved in making the highly distinctive radar dome for the new British Navy "stealth" warship. HMS Dauntless, which is described as the most advanced air defence warship in the world was recently dispatched to patrol the waters off the Falklands as tensions with Argentina escalated.
Birrane is also a major investor in the UK property market through his Peer Group firm. He helped rescue the Lola cars business after it ran into financial difficulties in 1997 after a bid to take part in the F1 grand prix.
Since then the firm has had considerable success on the track with the Lola-designed cars landing five titles in the Le Mans 24-hour race since 2000 plus a series of garlands in major US racing events.
Sunday Indo Business