Court sanctions scheme of arrangement for McInerney

 

AN ORDER sanctioning a scheme of arrangement for McInerney Properties plc was made yesterday by the High Court. The court was told the company had lost £55 million over five years to the end of December 1993.

The order pursuant to section 201 (3) of the Companies Act, 1963, was made by the president of the High Court, Mr Justice Costello, on the petition of the company presented by Mr Bill Shipsey SC.

The petition stated that the company, with registered offices at McInerney House, Herbert Street, Dublin, was the parent of a group of companies whose activities included construction of private housing and contracting in Ireland; leisure-related developments in Portugal and Spain; property development here; trading in land and buildings, and development of residential land for third parties.

Although now trading at a small current profit, the group incurred substantial losses over the five years to December 31st, 1993. They were primarily in respect of UK property development and house building and leisure developments in Spain and Portugal. They amounted to about £55 million in the five years.

Because of the losses during the five-year period, numerous group companies had since been placed in receivership or liquidation.

Others had ceased active trading.

But the group was now trading at a small profit in respect of its core activities, accrued losses and liabilities had an adverse impact on the financial position of the company and the group as a whole and threatened to cause the collapse of the group unless appropriately restructured.

Meetings had been held on December 6th and approved the scheme of arrangement.

Under the scheme, a new company, McInerney Holdings plc had been incorporated, with nominal share capital of £3.5 million; and Holdings would raise new equity finance of £6 million.

The A ordinary shares would be exchanged for shares in Holdings at the rate of 18.57 ordinary shares of 10p each in Holdings in respect of every 1,000 A ordinary shares in the company, or proportionately in cases of shareholdings or balances of shareholdings of fewer than 1,000 A ordinary shares.

The Revenue Commissioners were to be paid all amounts due in respect of Corporation Tax, capital duties, PAYE or PRSI deductions. Ordinary trade creditors were to be paid in full in cash.

Certain other creditors were to receive payments in cash at an approximate rate of 7p in the £. Other creditors were to receive shares in Holdings at an approximate rate of 7p in the £.