Survival scheme for Peats saves 27 jobs at two stores
THE HIGH Court has approved a survival scheme for electrical retailer Peats.
The scheme involves investment by the Peat family, which will mean two of its 11 stores will continue to trade and 27 jobs will be saved, the court heard.
Mr Justice Peter Charleton said he was happy to approve the scheme taking Peats World of Electronics out of examinership after hearing all conditions set down in an independent accountant’s report for its survival had been met.
Under the scheme, two Dublin stores, the original Peats of Parnell Street and another in Rathmines, are to continue trading. The 27 jobs are to be saved out of a previous workforce of 70.
The judge noted the Revenue, which the court had previously heard is owed €319,000, is to receive most of that figure, while unsecured creditors will be getting a 2 per cent dividend.
Creditors will get something, instead of what they would have got had the company been wound up, he said – nothing.
There would also be a saving to the exchequer of €163,000 in redundancy payments.
Mr Justice Charleton noted there had been a waiver of rent due to the Peat family for €390,000 and a rent holiday for 12 months on the Parnell Street and Rathmines stores.
In addition, there was a cash investment from Peats chairman Ben Peat and from Josephine Peat of €140,000 in working capital and €15,000 in equity, he said.
It was clear the company was capable of survival, while the economy would benefit from the saving of jobs, the judge said. If liquidated, the position of creditors would be worse, he added.
In a petition to the court last April, the directors of Peats said that while the company was incorporated in 1963 its origins dated from a family business established in 1934. William and Brigid Peat set up a shop at Parnell Street to sell wet-cell batteries, bicycles, furniture and prams. All six of their children had joined the business.
The company’s business grew year on year and was profitable, employing 90 people at its peak. It had decided to expand through opening stores trading as Sony Centre stores – single-brand outlets showcasing Sony’s range. The company also opened five stores under the Peats brand between 2005 and 2011.
The most obvious reason for its financial difficulties was the precipitous decline in turnover since 2008, the directors said. Turnover had peaked in the financial year ended March 2008 at €23.4 million, three times the 1998 figure.
The downturn and the waning of the Sony brand from 2007 negatively affected business. Sales declined more rapidly in the Sony stores than in Peats stores and overall turnover fell to just more than €10 million this year.