The High Court has made an order winding up troubled fit-out firm Mac Interiors.
Mr Justice Michael Quinn made the order after being informed by the company's examiner Mr Kieran Wallace that it was not possible to put together a modified rescue plan with a new investor, which if approved by the court and its creditors, would have saved the company.
The firm has 31 full time employees, had employed many more as subcontractors, and owes its creditors over €27 million.
The firm entered examinership earlier this year.
It had traded very successfully in Ireland, the UK and continental Europe for many years, 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.
Late last week, the judge ruled that the court lacked the jurisdiction to approve a scheme of arrangement put together by Mr Wallace of Interpath Advisory that if approved, would have allowed the firm to successfully exit examinership and continue to survive as a going concern.
Revenue had opposed the application.
After the court's decision, a proposed investor who had committed funds towards the company's survival scheme pulled out of the deal.
The examiner then held talks with a potential new investor regarding the possibility of putting together "a modified" scheme of arrangement.
On Wednesday morning James Doherty SC for the examiner told the court that it had not been possible to put a set of revised proposals before the court, and the only option was to make an order winding up the company.
Counsel said that Mr Wallace had at all times acted in the best interests of the creditors and was prepared to act as the company's liquidator.
Counsel for the company Mr John Lavelle Bl, said his client agreed that there was no option other than place the firm into liquidation.
Given the amount of work already done by Mr Wallace and his familiarity with the company, counsel said that the examiner should be appointed as liquidator.
This, he said, would result in savings in relation to costs and time of the liquidation process.
Dermot Cahill SC, appearing with Sally O'Neill Bl, agreed that the company should be wound up. Counsel asked the court to appoint its nominee, Mr Aidan Murphy as liquidator.
Counsel said that Revenue was the firm's largest creditor and accounted for approximately half of Mac Interiors debt.
In his ruling Mr Justice Quinn said that it was accepted that no criticism had been made by either the court or Revenue of Mr Wallace, and noted the submissions that Mr Wallace's appointment as liquidator would save time and costs.
However, the court appointed Mr Murphy as liquidator, on the grounds that Revenue is the company's main creditor.
In his judgement last week Mr Justice Quinn rejected the examiner’s original proposal for returning Mac Interiors, which owes creditors some €27 million, to solvency following opposition by Revenue,
Revenue is owed €14.3 million, including €13.2 million in warehoused debt that would have been almost entirely written down.
Mr Justice Quinn found the only impaired creditor class had been “erroneously formed”.
As a consequence of this finding, no meeting of a validly formed class of impaired creditors has accepted the proposal, which involved a proposed investment from Quartz Holdco Limited comprising a loan of €2.25 million and €1.5 million working capital.
All other tests were satisfied and, the undisputed evidence showed, the plan would provide the company with a reasonable prospect of survival, he noted.
