Construction company MAC Interiors Limited has a reasonable prospect of survival following an expedited examinership process, its newly appointed examiner has told the High Court.
The company, which specialises in office fit-outs, sought the court’s protection from its creditors two weeks ago, and Kieran Wallace, of Interpath Advisory, was appointed as interim examiner.
The court heard previously that the company had traded very successfully in Ireland, Britain and continental Europe, with clients including Microsoft, AIB, Ryanair, Pinterest, Barclays Bank and Citibank.
However, it was badly affected by the pandemic restrictions curbing construction and subsequent inflation on construction materials.
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It also sustained significant losses on its involvement in a project in Liverpool in England. It advanced £14 million (€16.2 million) in loans to a related company to pay subcontractors on the job and these loans are not likely to be recovered, the court heard.
While it has ongoing projects, the company, which has 41 full-time employees following lay-offs, has a projected deficit of about €9 million.
The court was told on Wednesday that no creditor was objecting to Mr Wallace being appointed as examiner.
Revenue, MAC Interior’s largest creditor, was not objecting to the appointment, its counsel, Sally O’Neill, said. The tax authority is owed some €11 million.
Mr Justice Michael Quinn was satisfied he had jurisdiction to appoint the examiner to Newry-registered MAC Interiors on foot of its own petition despite it being incorporated outside the European Union.
He heard extensive submissions from Kelley Smith, senior counsel for MAC Interiors Ltd, appearing with John Lavelle, to persuade him the company’s main centre of interest was in the State.
The judge said he would soon give a written judgment explaining his decision, which is the first time the High Court has appointed an examiner to a petitioning firm incorporated outside this jurisdiction.
Through his senior counsel James Doherty, Mr Wallace informed the court he envisages the firm’s cash flow will be sufficient to cover the examinership process but he will continue to monitor this.
Reading from Mr Wallace’s report, Mr Doherty said there had been extensive engagement between Mr Wallace’s team and the company’s senior management in the last two weeks.
The process should put the company in a better position to obtain performance bonds, he said.
The business continues to receive support from most of its subcontractors and clients, who have been largely unaffected by the interim examinership as construction is ongoing, Mr Doherty said.
Mr Wallace believes the examinership would benefit from an “expedited process” and he hopes to put together a survival scheme in “short order”, the court heard.
Mr Wallace is due to update the court again in early July.
