Inter-group debts may pose problems for Carroll firms

THREE OF the seven companies in Liam Carroll’s Zoe group which failed to secure court protection last week are owed €8 million by companies in his other two property groups, Dunloe and Orthanc.

The inter-group debts have the potential to draw two other substantial parts of Mr Carroll’s wider business empire into insolvency actions by bank creditors, who are owed €1.3 billion by Zoe.

The seven Zoe group companies outlined the extent of the debts between the groups in submissions to the court in their unsuccessful second attempt to seek court protection under a period of examinership.

If the companies decide not to appeal the High Court ruling rejecting their survival bid, the court is today expected to hear winding-up petitions from Dutch lender ACCBank to liquidate Vantive Holdings and Jersey-based Morston Investments, as the bank attempts to recover unpaid debts of €136 million.

A business plan drafted by accountants KPMG, which was heavily criticised by the court last week, showed that Vantive is owed €6.25 million by debtors in the Orthanc group.

The group owes a further €34,000 to Morston. Vantive and Morston acted as financiers channelling bank loans to companies across the Zoe group.

Royston, the architectural, engineering and quantity surveying company within the Zoe group, is owed €1.5 million by debtor companies in the Dunloe group.

Royston had been contracted by Dunloe to construct a building in Cherrywood, south Dublin.

The Sunday Business Post reported yesterday that Mr Carroll’s advisers and lenders held talks over the weekend to secure the future of Orthanc and Dunloe and prevent banks moving against the two groups. Mr Carroll’s three groups are estimated to have bank debts totalling €2.8 billion, of which €1.3 billion relates to the borrowings of the Zoe group.

The three groups fall under the control of a fourth known as Showlay which is owned by Liam Carroll and his wife Róisín.

The High Court will hear at 2pm today whether the seven Zoe companies intend to appeal to the Supreme Court the court’s rejection of the group’s proposed survival plan.