THE TROUBLED Iralco manufacturing plant in Co Westmeath which went into liquidation last month could require investment of up to €10 million to survive.

At a creditors' meeting yesterday, liquidator John McStay said the company had received a number of tentative approaches from potential investors but no firm offers. "They are very tentative. At the moment we are at the very early stages."

The company went into liquidation in April due to financial difficulties, despite having plenty of orders on its books. It produces components for some of Europe's best-known car manufacturers, including Audi, BMW, Ford, Seat, Volvo and Jaguar, and Mr McStay said these manufacturers were content to trade with the company as it seeks new investment or a buyer. "We have a broad commitment from them that they will continue to take products from the company for a period of about six months," he said.

"That gives us an opportunity in the next few months to try to find a buyer for the business, because once we have gone halfway through that six-month period, in fairness to those customers, they need to start making alternative plans on the assumption that the Iralco plant won't be around."

Representatives of one of the manufacturers confirmed to the meeting that it had identified a number of possible sources of investment.

Mr McStay said the key was to find an investor who would be acceptable to the manufacturers.

"If it is not somebody in whom the manufacturers have confidence, then the orders will just evaporate and nobody would be foolish enough to make the investment if they weren't certain they were going to get the support from the manufacturers," he said.

Should a buyer or investor fail to materialise in the coming months, the company would have realisable assets from liquidation of €9.97 million if it was sold on a closed-down basis, according to Iralco's estimated statement of affairs. However, after creditors were paid, Iralco would have an expected net deficit on realisation of €3.4 million.

The estimated dividend available to unsecured creditors for every €1 owed would be just under 63 cent. However, those figures do not provide for the cost of liquidation.

Trade creditors are owed about €3.4 million. Non-trade creditors total €3.17 million and include IDA Ireland, Saretone Ltd and Volkswagen AG.