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McInerney asks court to review rescue plan refusal

A JUDGE was yesterday asked to revisit his refusal to approve a rescue scheme for the McInerney construction group in light of what they claim is new information.

The High Court's Mr Justice Frank Clarke was asked by the company to look again at his decision last Monday to refuse to confirm the scheme for McInerney Homes Ltd and McInerney Contracting Ltd after the judge found it was "unfairly prejudicial", to a syndicate of three creditor banks, Anglo Irish Bank, KBC and Bank of Ireland.

The judge said he was satisfied the banks had "a realistic prospect of doing better" if a receiver was appointed to the firms than under the proposed scheme of arrangement.

However, the company now claims that loans it obtained from the banks are soon to be transferred to NAMA. As a result of that transfer the syndicate will not be in a position to appoint a receiver, thus removing the prejudice to the banking syndicate. The banks opposed the application to have the matter revisited, and argued that there is nothing new in the information.

The syndicate, owed more than €110m by McInerney, had opposed the survival plan which was put forward by the examiner to the firms, William O'Riordan. If it had been accepted by the court, it would have allowed the companies to come out of examinership and continue to trade.

In a sworn statement, McInerney group's finance director Enda Cunningham said the loans the company obtained from the banking syndicate are most likely to be transferred to NAMA. With that transfer, the syndicate would no longer be able to execute its proposed plan to place the company into receivership.

Mr Justice Clarke said the court would have to first decide whether it had jurisdiction, and adjourned the matter to early next week.

Irish Independent