Clerys ex-owner will repay store’s concessionaires if they promise not to sue
Consortium offers reimbursement in exchange for gagging orders
The Clerys Clock on O’Connell Street, Dublin. File photograph: Dara Mac Dónaill
The US fund that sold the Clerys operating company for €1 the night before it was put into liquidation four years ago has finally offered to reimburse the losses of the store’s 50 concession holders, but only if they sign gagging orders and promise not to sue it.
Boston-based Gordon Brothers, which sold Clerys to a building consortium in June 2015, has set aside €785,000 for concessionaires, which are other retail businesses that operated on the Clerys shopfloor as tenants. When the main store was controversially shuttered, they lost weeks’ worth of stock and takings.
The concessionaires, which included shoe retailer Ecco, Best Menswear and various catering operators, were originally owed more than €1.4 million. More than €650,000 was paid to them six months after the closure from the funds of OCS Operations, the Clerys operating company that is in liquidation.
The “ex-gratia” offer from Gordon Brothers to fund the shortfall from its own resources comes ahead of a High Court hearing next month, at which the KPMG liquidators will seek the disqualification of two Gordon Brothers executives over their alleged performance as Clerys directors.
Rafael Klotz and Malcolm MacAulay, who signed off on the controversial sale of Clerys, which went bust hours later with the loss of 430 jobs, face being restricted as company directors if the application is successful.
‘Gesture of goodwill’
Last week, the liquidators unexpectedly wrote to the concession holders to say Gordon Brothers will fund their shortfall as a “gesture of goodwill”. At least 70 per cent of concessionaires must agree and sign waivers for the payments to go through.
The waiver legally requires concession holders to promise not to sue Gordon Brothers, Mr Klotz, Mr MacAulay or OCS Operations, or to make any “critical or derogatory” statements about them.
The liquidators of OCS declined to comment. Mr Klotz and Mr MacAulay had not responded prior to publication.