Clerys closes doors as court appoints liquidators

About a dozen Clerys staff stage sit-in in protest

 

Clerys department store on O’Connell Street in Dublin has closed its doors for the final time with the loss of 460 jobs.

About a dozen Clerys staff staged a sit-in tonight at the store in protest at the events that unfolded on a dramatic day for the 162-year old retailer.

On Friday, Clerys’ US owners Gordon Brothers sold the business to a joint venture called Natrium Ltd, comprising Irish investment group D2 Private and Cheyne Capital Management. The sale price wasn’t disclosed.

Hours later the High Court appointed Kieran Wallace and Eamonn Richardson of KPMG as joint provisional liquidators to the company operating Clerys, OCS Operations Ltd.

Clerys employed 130 people at the store and in its warehouse. Another 330 were employed by the 50 concession holders who operate in the department store.

The new owners declined to comment.

In court, Mr Justice Paul Gilligan was told that the company operating Clerys must immediately cease trading and close down to prevent any further debts arising.

Between August 2012 and January 2015, the business lost €4.3 million and relied on loans from its parent group.

The court was told the company is unlikely to have sufficient monies to make upcoming payments, including payments due early next week, and is unable to pay its debts.

The liquidators would be best placed to preserve the value of the business, deal with employees, the concession holders and creditors, the company said.

The judge said he was satisfied to make the appointments as the firm was “balance sheet insolvent” and appeared to be in “severe financial difficulty”. This is pending the hearing next month of the petition to have it wound up.

Anne-Marie Cleary, from Phibsboro, Dublin, was the last customer to exit the store before the shutters were pulled down.

“It’s horrific for the staff,” she said. “I like it as a store. I like to support it because it’s an old traditional Dublin store and a great old Dublin institution. I’m shocked. I’m really sorry to hear it and I hope something can be done so they don’t lose their jobs.”

From about 6.30pm, as staff made their way out of the store through an exit at the back of the building, many were visibly emotional and paused to comfort colleagues.

Sharon Maguire (45), from Baldoyle, Dublin, said she had worked at the store for more than 18 years as a hairdresser.

“We were told at 6pm the company was gone into liquidation and is closed from now,” she said. “We’re devastated. I’ve only booked my holidays yesterday and I’ve no job now. We don’t know what’s going to happen.

OCS Operations Ltd and OCS Properties Ltd, which owns the store, are both owned by OSC Investment Holdings Ltd and form the OCS group of companies whose ultimate parent is Gordon Brothers. The group acquired Clerys in 2012 from receivers and it was put on the market by Gordon Brothers in January.

Following the sale on Friday, Natrium removed OCS Operations from the group and transferred the shares in that company to insolvency practioner Jim Brydie, Kingsmere Road, London for €1.

Mr Brydie and another insolvency practioner, Brendan Cooney, after being approached by Natrium, were on Friday appointed directors of OCS Operations. The previous directors resigned.

Mr Brydie and Mr Cooney, who are separate entities from Natrium and had no involvement in the sale of the OCS, then examined the company’s financial position.

Kelley Smith BL, for OCS Operations, said, arising out of the examination, the company had no alternative other than to seek the appointment of liquidators. OCS Operations had since 2012 traded at a loss and was now balance sheet insolvent.

Between August 2012 and January 2015, it lost €4.3 million and relied on OCS Investment Holdings for support in the form of loans.

While those loans are not repayable until September 2016, a change in the shareholder, as had occurred, meant a demand for the loans facilities to be repaid can be made, counsel said.