Shannon Key West owes over €3m as liquidator closes down business
Published 20/10/2011 | 05:00
LEITRIM'S Shannon Key West Hotel has been closed by a court-appointed liquidator with the loss of 20 jobs. The business closed with debts of more than €3m.
Liquidator Sean Mulhern, of Mulhern Leonard in Sligo, took control of the business on Monday. The appointment was made after a hearing in the High Court in Dublin.
Tax authorities petitioned the High Court to have a liquidator appointed over unpaid taxes of more than €200,000.
The court agreed to the appointment of a liquidator and adjourned the case until November 21.
Around 20 staff lost their jobs when the hotel, which is well known from country music events and weddings, closed its doors on Tuesday.
There are no plans to re-open the hotel at present.
The family-owned business has debts of more than €3m, mainly owed to AIB, as well as the €200,000 owed to the tax authorities.
Last year the Flynn family, which owned the hotel, wrote down the value of the premises to €2.25m from more than €5m. The business also owes a substantial sum to the family, according to accounts filed with the Companies Office.
AIB has a charge over the building, which gives it the right to sell the hotel business, either empty or potentially as a going concern. The Irish Independent has learned that no firm plans have yet been made on how or when to proceed with a sale.
Proceeds of any sale are understood to be unlikely to pay off the bank debt. It means the Revenue Commissioners are unlikely to recoup anything after closing the hotel.
The expected shortfall means staff and local suppliers are also set to receive nothing for any debts owed, even after all of the hotel's assets are sold off.
Bookings at the hotel will not now be honoured and cash paid as deposits for events such as weddings or room booking will be paid out only in line with the payout to other unsecured creditors.