Losses at Clerys down €2m in year before liquidation

Losses at the Clerys department store reduced by more than €2 million in its final full year of trading, according to documents filed with the High Court.

This was after consultancy fees of €517,853 were booked in its administrative expenses.

Accounts for OCS Operations Ltd, which ran the department store until its closure on June 12th, show it made a loss of €1.1 million in the year to the end of January 2015. This compared with a loss of €3.1 million for an 18-month period ending February 1st, 2014.

It is not clear from the accounts to whom the consultancy fees were paid.

The accounts also show just under €1.4 million worth of loans from group companies was repaid by OCS Operations in the year to January 2015.

OCS Operations and other entities associated with Clerys were put up for sale by Boston-based Gordon Brothers in January this year.

These latest accounts were signed off on by the Gordon Brothers directors on June 11th, the day before the business was sold and the store closed in dramatic fashion.

Gordon Brothers sold this entity, along with the holding company, OCS Investment Holdings Ltd, and OCS Properties Ltd, which owned the building on O’Connell Street.

The businesses were sold for €29 million to Natrium Ltd, a joint venture comprising Deirdre Foley's D2 Private and UK-based Cheyne Capital Management with funding from Quadrant Real Estate Advisors, in the early hours of June 12th.

Insolvency specialist

Natrium then immediately sold OCS Operations to UK insolvency specialist Jim Brydie for €1. Mr Brydie petitioned the High Court on June 12th to have Kieran Wallace and Eamonn Richardson of KPMG appointed as provisional liquidators.

Documents filed with the High Court include minutes of a board meeting of OCS Operations Ltd on the day Clerys was sold.

The minutes detail how Rafael Klotz and Malcolm MacAulay – directors on behalf of Gordon Brothers – resigned while Mr Brydie and an associate, Brendan Cooney, were appointed in their place.

The minutes indicate this board meeting was held at 1.15am on June 12th, putting it some 75 minutes before OCS Operations was sold to Natrium at 2.30am.

Later that day, Mr Brydie and Mr Cooney, as directors of OCS Operations, wrote to OCS Properties to ask if it would grant a “further formal lease” on the department store. The previous lease had expired on March 16th.

Ms Foley replied that day on behalf of OCS Properties to say that it was “not prepared to grant . . . any further lease or letting”.

She said she would wait to hear from OCS Operations “regarding your plans to vacate”, adding that “a formal notice to quit will be served in due course, if necessary.”

No ‘further monies’

Separately, a letter sent on the same day to the directors of OCS Operations – presumably Mr Brydie and Mr Cooney – by the holding company OCS Investment Holdings said €4.6 million in loans was outstanding and that it would not be providing “any further monies”.

The letter was signed by Ronan Daly, who is listed as a director of Cheyne funds in Ireland. Having had its lease revoked and its loans effectively called in, OCS Operations was then placed into liquidation by Mr Brydie.

These documents shed light on the chain of events on June 12th that led to Clerys being closed after 162 years of trading. The liquidation resulted in 130 staff being made redundant. It also affected 330 staff employed by 50 concession holders.