Joint provisional liquidators have been appointed to two linked Co Cavan companies involved in the construction of European data centres.
ACB Group- Design and Construct Limited and ACB Manufacturing Ltd had 23 employees who will be made redundant.
The companies, which have registered addresses at Ranrenagh, Ballyjamesduff, were petitioned in the High Court by one of their directors, Georgina Quigley.
So far this year, ACB Design and Construct has made a loss of over €2 million, and it is now insolvent, according to petition documents.
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While it appears from records that this firm is profitable and balance sheet solvent, the termination of certain contracts and contra-claims by main contractors has effected this. It now has estimated debts of €1.9 million and fixed assets that are likely to realise less, the petition says.
The court heard a number of creditors have issued payment demands, while ACB Design and Construct owes Revenue some €250,000. Among its main creditors are Kingspan, Bank of Ireland and Enterprise Ireland, the court was told.
ACB Design and Construct was incorporated in 2003 and engaged in projects involving data centres, logistics warehouses, motorway service stations and holiday villages.
Since 2019 the focus has been on global data centre solutions, with one completed project in Germany and four other European ventures, according to the petition.
The firm blames elongated programmes and a lack of co-ordination for the projects it was subcontracted for being “significantly loss-making”.
Attempts to recover the business through contract renegotiation and submissions of claims to clients for delay and disruption of projects have been unsuccessful, the petition says.
Serious consideration was given to a restructuring arrangement through a court-supervised examinership, but two potential investors confirmed they were not prepared to fund the required scheme of arrangement.
ACB Manufacturing was established in 2021 to support the group’s off-site construction aims. Its only customer was ACB Design and Construct, which owes it €150,000 that is now irrecoverable due to its winding-up.
For this reason ACB Manufacturing is in fact insolvent on a balance sheet basis, its petition states.
ACB Manufacturing’s professional indemnity insurance cover is due to expire on Friday, the companies’ counsel, Catherine Needham, told the court. Some €40,000 would be due to the insurer upon expiry if provisional liquidators are not appointed, she said.
The provisional liquidators would have automatic cover upon their appointment, the court heard.
Mr Justice Brian O’Moore made orders appointing Declan Taite and Ann O’Dwyer of Kroll as joint provisional liquidators. He was satisfied the companies were insolvent and unable to pay their debts as they fall due.
He also said there was a “high risk” for the firm if the insurance was allowed to lapse without making the orders.
The hearing of the petition is listed for November 28th.
