BoI opposes continuation of company's court protection
BANK of Ireland is opposing the continuation of court protection for a company involved in the door-to-door selling of credit on a wide range of goods to 26,000 people across the country.
Murray Nolan Ltd, with registered offices at Clonee, Co Meath, employs 55 people directly while 65 self-employed commission-based sales agents handle door-to-door sales of goods including clothing and homeware.
The company, whose directors are Michael Murray, of Moynalvey Manor, Summerhill, Co Meath; and Tom Nolan, of Tankards Garden, Newbridge, Co Kildare; issues a catalogue of products twice yearly featuring products sourced from a variety of suppliers but mostly from Littlewoods/Shop Direct.
The company has debts of some €5.6m. If wound up, it claims it would have a deficit of some €4.4m but would have a deficit of some €735,283 on a going concern basis.
Among the causes of its difficulties were falling sales, a reduction in the collection rate of outstanding debtors and problems with its Christmas hamper business, it said. An independent accountant believed the company could survive provided certain conditions were met, the court heard.
It had disposed of the hamper and savings club aspects of the business last December and was engaged in cutting staff numbers and overheads.
Bank of Ireland, its largest creditor with debts of some €1.9m, is opposing examinership because it does not believe the company has a reasonable prospect of survival.
While the company had identified a potential investor who might provide around €500,000, the bank said three times that sum was required and described as "optimistic and incomplete" its cash flow projections for the examinership period.
The bank noted directors' remuneration up to December 2009 was €333,334 when the company had a trading loss of €130,855 that year. In 2008, the loss was €374,516 and €708,790 for the 15 months to end December 2007. The examiner's costs and remuneration of €250,000 would also prejudice the bank, it said.
Accountant Simon Coyle of Mazars was appointed interim examiner last month and the matter was before Mr Justice Peter Kelly yesterday to consider whether to confirm Mr Coyle as examiner. In a report, Mr Coyle said he believed the company could survive if Littlewoods agreed to continue to provide supplies to it.
The court heard Littlewoods wanted payment of some £35,000 (€41,450) due to it but had not given a commitment to continue supplying the company. Mr Justice Kelly adjourned the case to next Wednesday.