Concrete company can continue trading pending survival plan, High Court rules
Judge orders that Interim examiner to be put in place to come up with a survival scheme for Carlow-based Dan Morrissey Irl Ltd within 100 days
A TROUBLED concrete and quarrying company - where six years ago 16 workers won nearly €19m in the lotto - can continue trading pending efforts to come up with a survival plan for it, the High Court ruled.
Mr Justice David Keane yesterday ordered that joint receivers appointed on Thursday to Carlow-based Dan Morrissey Irl Ltd by AIB - owed €27m by the company - should cease to act and that an interim examiner be put in place to come up with a survival scheme within 100 days.
The family company, established in the 1930s by Dan Morrissey, was at one time one of the biggest suppliers of materials in the building trade.
In 2008, a lotto syndicate operated for the previous seven years by 16 of its employees scooped what was then, and remains, the highest ever jackpot of €18.9m in the national lotto draw. Each received €1.18m.
Gary McCarthy SC (with Bernard Dunleavy BL), on behalf of the directors of the company, told the court yesterday the application for an examiner was made because the directors believed it was possible for it to continue as a going concern by restructuring the debt and pay it off by continuing to trade.
The alternative was that the liquidation sought by the bank would result in the loss of employment for 131 direct employees.
As matters stand, the company has ceased trading and employees have been told all will be made redundant under receivership which itself could cost around €3m because of the lenght of service of employees, counsel said.
AIB is owed nearly €27m, of which €17.8m is in term loans with a €9m overdraft facility. What had happened was that the overdraft had been "creeping up" over time and the company had been in active negotiations to renegotiate the debt, counsel said.
This was a third generation family firm which manufactures pre-cast concrete products, owns eight quarries and operates a number of other businesses including a butcher's shop, counsel said.
A lot of people, including 80 indirect workers, depend on it. It has a number of blue chip clients including county councils and has some €4.5m worth of contracts in the pipeline.
In 2006, it had an annual turnover of some €250m but this had dipped to around €17m-€18m largely because of the downturn in the building industry.
However, business was now beginning to look up and it was anticipated that if the debt could be restructured to around €15m, the expected annual profits would make the debt manageable, counsel said.
Irish Cement, which is among the company's biggest creditors, had indicated it was supporting the examinership application, he said.
Two directors, Phillip and Kevin Morrissey, had also indicated on behalf of sister company Dan Morrissey UK, which owns valuable land banks in the UK, that they were prepared to meet any shortfall in cash flow during the examinership period, counsel also said.
Mr Justice Keane said he was satisfied to appoint Brian McEnery of BDO as interim examiner. He also ordered that the joint receivers appointed by the bank cease to act as and from today and he said the matter could come back before the court next Thursday.