Monday 26 June 2017

How a bitter family dispute is ripping apart luxury Kilkenny Group store empire

Marian O’Gorman, founder of The Kilkenny Group, with TV3’s Collette Fitzpatrick at the Kilkenny Shop’s first birthday in Cork. Photo: Don MacMonagle
Marian O’Gorman, founder of The Kilkenny Group, with TV3’s Collette Fitzpatrick at the Kilkenny Shop’s first birthday in Cork. Photo: Don MacMonagle

Dearbhail McDonald and Donal Lynch

The Kilkenny Group founded by entrepreneur Marian O'Gorman is poised to dismiss Michael O'Gorman, her husband of 40 years.

Mr O'Gorman is understood to have worked in logistics at the luxury retail business which is at the centre of a bitter court dispute.

The row came before the High Court last week and is tearing apart one of Ireland's leading retail dynasties.

The group employs 300 people across 15 stores and owns a highly valuable online portal, www.kilkennyshop.com, as well as "significant" properties.

Greg O'Gorman, Marian O'Gorman's son and the group's former marketing director, is suing his mother, alleging that he and his family have been left "destitute" after he was "summarily dismissed" from his role last summer.

Greg O'Gorman, who says he received a €50m valuation for Clydaville Investments, trading as Kilkenny Group, has asked the High Court "if necessary" to appoint a receiver and sell the company's assets to secure what he claims is his 25pc equity share - which he says is valued at €12.5m - in the business.

Read more: Inside the Kilkenny Group: how a family succession plan fell apart

Now it has emerged that Marian O'Gorman's husband Michael O'Gorman - whom the High Court heard she recently separated from - is facing dismissal from the Kilkenny Group.

The Irish Independent has learnt that Michael O'Gorman was informed by letter on February 10 that the Kilkenny Group intended to let him go for alleged "gross misconduct".

"You have not made yourself available for work for over four months," wrote Conor Lynch, Finance Director of the Kilkenny Group.

"Last week you broke into the Group's Spanish property and you have remained there since as a trespasser.

"In view of the seriousness of the matter, Kilkenny Group is minded to terminate your employment for gross misconduct.

"We are prepared to afford you the opportunity to make written submissions as to why you should not be dismissed," added Mr Lynch, who gave a deadline of 5pm last Thursday for written submissions.

Although owned by the Kilkenny Group, the Spanish villa has been used by various members of the O'Gorman family for years as a holiday home.

Last month, Mr Lynch wrote to Marian and Michael O'Gorman and their four adult children - Michael, Michelle, Christopher and Greg - to tell them that the board of Clydaville Investments had taken a decision to sell the villa.

Mr Lynch wrote to the family on January 30 and told them that access to the villa had been cut off with immediate effect to facilitate its sale.

"As the company is not in possession of keys or passcodes to the villa, all locks and Pin numbers have been changed," wrote Mr Lynch, adding that any personal items would be packed and returned to the family.

Neither the Kilkenny Group /Marian O'Gorman nor Michael O'Gorman responded to requests for comment.

Mediation

Last week, a High Court judge pleaded for Marian O'Gorman and her son to consider mediation to avoid a public exploration of the family business dispute.

The row between Greg O'Gorman and his mother centres on a 2010 agreement, known as the "Family Constitution" governing the future ownership and management of the group.

Marian O'Gorman is the named shareholder of Clydaville Investments. But Greg O'Gorman says she holds the company on trust for him and his siblings against whom he has made no criticisms but who have been joined to the proceedings as notice parties.

Read more: Family at war as 'destitute' son sues 'domineering' matriarch

Mr O'Gorman says the case needs to be heard quickly as there are "critically-important decisions" to be taken concerning the future strategic direction of the company of "a commercially sensitive nature".

Clydaville refused to be drawn on the prospect of a sale. However, changes to the family constitution were referenced in an August 2, 2015, email sent by Marian O'Gorman to EY, the accountancy firm, noting an agreement by each family member that the company could be sold within five to 10 years if profits were doubled within such a time frame.

According to Greg O'Gorman, his mother declared at the June 22, 2016, meeting that the company would no longer operate as a family business and would no longer be referred to as a family business.

Marian O'Gorman is alleged to have told her family that she would have full control of the business going forward, that there would be no overlap between business and family and that those present at the meeting had "responsibilities but no rights".

Irish Independent

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