First SME exits examinership through low-cost route

Celbridge Playzone, a Kildare-based children’s play centre, has become the first Irish company to exit examinership through the Circuit Court.

In Naas Circuit Court yesterday Judge Gerard Griffin approved a scheme of arrangement for the firm prepared by accountants Hughes Blake. Approval ensured the jobs of its 33 employees were saved.

“I wish the applicant every success in the future,” Judge Griffin said. “This is new territory for all of us.”

Outside the courtroom Joe Walsh, examiner with Hughes Blake, said: "This is a much more cost effective way for viable SMEs to restructure their debts."

Until now, all examinerships have taken place in the High Court, something which involves travel to Dublin and much higher costs.

Mr Walsh declined to comment on his fees, but it is understood the cost was about 15 per cent of the typical cost of about €100,000 for a High Court examinership.

Barry Lyons, partner with Lyons Kenny solicitors, who represented the company, said: "The company can go now, start again with a clean slate and new investment."

The principals of Celbridge Playzone secured additional investment from a family member of €25,000 in order to secure its scheme of arrangement. The company was founded by Pat Kelly and Annette Kelly in 2005.

Debts to the Revenue Commissioners were paid in full while preferential creditors received 10 cent in the euro and unsecured creditors got five cent. The company also agreed a new lease arrangement with its landlord which reduced its rent from €105,000 per annum to €50,000.

Mr Lyons predicted that the numbers of examinerships by SMEs would increase sharply as until now the cost of a High Court application put the process outside their range.