An interim examiner has been appointed by the High Court to companies that are major manufactures of ice-cream and cream liqueurs that has become insolvent and unable to pay their debts.
The appointment was made in respect of Silver Pail Dairy, which employs 82 full time staff, as well as several contract workers at various times of the year, in Fermoy Co Cork.
The court heard that despite the group's current difficulties it can survive and continue to trade if certain steps, including entering the examinership process, are taken.
The business has traded successfully for many years the court heard but has experienced financial difficulties due to the impact of reduced sales during the Covid-19 pandemic, and increased costs such as energy and commodity prices,
The court heard that the business owes its trade creditors €4.16m and owes €2.46m to Revenue. Its main creditors also include AIB Bank, Arrabawn Co-Op, IPL Protech Performance Plastics, and Carbery Food Ingredients.
Additional investment
It had sought additional investment and had been engaged in discussions with a potential investor for several months. Those discussions ultimately broke down, resulting in the group being without working capital it requires.
Some of its suppliers were insisting on cash on delivery for goods, and the company has been in contact with its electricity suppliers to ensure its power is not cut off.
Despite its difficulties the High Court heard on Monday that an Independent Experts Report had stated that the company can survive if significant restructuring takes place.
To do this the firm required the appointment of an examiner who would see if a scheme of arrangement can be agreed with the group's creditors.
The examiner could also seek to bring in additional investment into the group.
At the High Court on Monday Mr Justice Brian O'Moore appointed insolvency expert Shane McCarthy as interim examiner to Silver Pail Dairy Ireland Unlimited Company and a related entity Havana Company Unlimited.
Silver Pail Dairy, which makes tubs of ice cream and Irish Cream Liqueur for the Irish, UK, EU, Middle Eastern and US Markets. It had petitioned the court for the appointment of the examiner, which will give the group protection from its creditors.
It claims that the appointment was in the interests of all affected parties, including its creditors and its employees.
Creditors would do much better under a successful examinership compared to if the group was wound up, the court also heard.
While the company was clearly insolvent, Mr Justice O'Moore said he accepted the findings contained in the expert report put before the court and was satisfied to appoint Mr McCarthy on an interim basis.
The judge also approved pre-petition payments, including payment of the group's employees' wages.
The matter will return before the court in January.
