Investor sought as newspaper goes into examinership
Reporter Ian Kehoe and editor of the Sunday Business Post Cliff Taylor yesterday after a High Court hearing. The court heard the company that owns the newspaper was "insolvent". photograph: collins
An investor will be sought for the Sunday Business Post after the company that publishes the newspaper was placed into interim examinership yesterday.
Mr Justice Peter Kelly agreed to the appointment of Michael McAteer of Grant Thornton as interim examiner of Post Publications Ltd (PPL), which publishes the paper.
Garvan Corkery SC, for PPL, told the court the company was “loss-making and insolvent” and had lost the financial support of its Cork-based parent group Thomas Crosbie Holdings (TCH) following a major restructuring of that company’s assets on Wednesday.
This involved a new company called Landmark Media Investments Ltd, owned by Tom and Ted Crosbie, acquiring most of the assets of TCH.
This did not include Post Publications Ltd (PPL), which had not guaranteed any of the liabilities of TCH and was not subject to a charge by the Cork media group’s main lender, AIB.
Landmark is believed to be interested in acquiring PPL from examinership.
Mr Corkery outlined how PPL has been loss-making since January 2008.
It recorded a net operating loss of €1.2 million in the year ended January 1st, 2013, and is projected to record a loss of €1.4 million this year.
Revenues have fallen from €15.6 million in 2007 to €7.4 million in 2012. PPL has no debt but has relied on financial support from TCH for the past four years. This is now no longer available.
An independent accountant’s report compiled by David Carson of Deloitte has forecast that PPL can return to profit next year and has a “reasonable prospect of survival” subject to certain conditions being met.
The court was told that the company’s own financial resources would be exhausted by week 13 of the examinership when a deficit of €164,795 would be recorded.
AIB has agreed to provide financial support of €150,000 at this point to enable PPL to see through its examinership.
Mr Carson’s report estimates that an annual saving in rent of €220,000 can be achieved on its lease of offices in Harcourt Street, Dublin.
It owes €598,344 in rent arrears to its landlord, Irish Life Assurance plc.
A reduction of €367,000 in printing costs this year is also forecast.
A pay cut of 7 per cent along with 20 to 25 redundancies among the 76 staff are also likely, the court was told.
Agreeing a new printing deal was cited as being key to the future of the paper.
The court was told that a failure to print the paper on Sunday could be “fatal” for PPL.
A full examinership hearing will be held on March 15th.