Winding up of pharmacy funds could leave €240m shortfall
Published 18/02/2010 | 07:36
THREE collapsed pharmacy ownership funds established to help pharmacists own their businesses could leave a shortfall of as much as €240m when they are wound up, creditors' meetings were told last night.
The funds are all part of the Independent Pharmacy Ownership Scheme (IPOS), which has minority stakes in the holding companies that own about 150 pharmacies nationwide.
The IPOS announced plans to wind up three of its funds at the start of the month, citing a number of "underperforming" pharmacies that had struggled to pay interest on their IPOS loans and dividends to their IPOS shareholders.
Creditors' meetings were held for the three collapsed funds and a fourth firm, IPOS Locum, which supplied temporary pharmacists to the industry.
Creditors of the 'IPOS Investment' fund are understood to have been told of a "minimum" shortfall of €3.5m, plus another €20m worth of "contingent creditors" whose status needs to be investigated. 'IPOS Investment Two' reported a minimum deficiency of €5.5m and another €37m of contingent liabilities, while 'IPOS Investment Three' has a minimum shortfall of €33.5m and contingent liabilities of another €142m.
The figures mean the funds' combined deficiency is at least €42m, and potentially as high as €240m, depending on the outcome of the contingent liabilities, which are understood to include guarantees given by the funds.
A significant amount of the massive shortfall is understood to be owed to IPOS group companies, while individual pharmacists also feature on the creditors' lists. Drugs distribution giant Uniphar, which backed the scheme, has taken a €98m writedown on the value of its IPOS investments.
Following last night's meetings, liquidator Kieran Wallace of KPMG will begin efforts to realise the funds' assets, largely stakes in the holding companies of pharmacies.
Some of those stakes are likely to be governed by agreements that offer the pharmacists first refusal on the purchase of the IPOS shareholding, which ranges between 2pc and 42pc.
The Irish Pharmacy Union has already committed to "supporting the pharmacists to ensure their interests are fully considered by the liquidator".
IPOS Locum, meanwhile, posted a €9.5m shortfall.