Opinion: Yet another Irish listed company is about to finally bite the dust, and will anyone be sorry? In 17 days time, Unidare's 1,400 shareholders, who include financier Dermot Desmond, will be asked at what will be its 58th, and last annual general meeting, to approve the appointment of David Hughes of Ernst & Young as liquidator at an estimated cost of €150,000, and to approve the distribution of any remaining assets to them.

If, as expected, these resolutions are approved, dealings in the Unidare shares will cease.

Up to now, the dismembering of the group's assets has been relatively straightforward. Following the receipt of the proceeds from the sale of individual companies, the shareholders received plump payments.

Last year, for example, they received a distribution of €2.40 for each share, following the sale of Dutch manufacturing subsidiary Daalderop, and this year there was a distribution of €2.60 following the sale of ORS Nasco, a US wholesale business which, ironically, includes Oklahoma Rig & Supply Company, whose acquisition was unsuccessfully resisted by Dermot Desmond (he has more than doubled the value of his investment) and Pierce Casey seven years ago.

Surprisingly, almost 700 of the smaller shareholders have not yet cashed their cheques, amounting to a total of €700,000, which will go into a special fund if they, or their next of kin, are not found. That represents an average of about €1,000!

Overall, while there are some delays in the payments due to the need for court approval, these were pretty minor compared with what will probably happen in the final stage.

The circular with the declaration of solvency, out this week, shows net assets of €8.2 million, equal to about 40 cent per share. However, shareholders should not expect any quick payment because it decided to go down the unpredictable liquidation route.

The circular says that the winding up could be completed by the end of 2006. That seems like a long timescale, but even that target date could well be much longer. Unidare has alerted shareholders that "there are, however, a number of uncertainties . . . these uncertainties mean that the winding up of the company may occur after the end of 2006 and could also be more costly than estimated, which could impact on the estimated timing and amount of the final distribution that would be made to shareholders". The statement of affairs shows cash of almost €12 million, receivables of €900,000 and investment in group properties of €9 million.

Apart from the estimated cost of liquidation, the liabilities include unclaimed dividends of €700,000 and €9 million owing to group companies.

It is a great pity to see a profitable company being wound down.

Unidare increased its sales from €208.3 million to €223 million in the year to September 30th, 2005, while operating profits rose from €9.98 million to €12.1 million (including discontinued operations).

Adjusted earnings per share improved from 33.4 cent to 45.1 cent, and, indicating a strong company, interest and finance costs took less than 5 per cent of the profits.

However, Unidare has had a very cyclical record and this took a very heavy toll on the share price. And the winding down route taken has been considerably more profitable for shareholders.

A €5.40 payment is above the €4 plus price in 1995 and represents a three to fivefold increase on the share price's range in 2001 and 2002, reaping benefits for investors such as former stockbroker Ray French.

But is has also been very lucrative for the two executives charged with the disposal programme. Their extra bonuses were directly linked to the consideration received for the three companies; Daalderop, ORS Nasco and Eland. It could be argued that these duties should have been performed for the salaries they received, and having a bonus scheme might cloud their judgment on the underlying performance of the companies that they were selling.

ORS Nasco, for example, has had a very good record. Profit before tax rose from €2.6 million in 2003 to €7.8 million in 2005, and the record looks equally good when Unidare's management charges are excluded, yet the circular sent to shareholders recommending the sale of that subsidiary merely described its outlook as "satisfactory".

Also, the risk factors in circulars tended to go overboard on pessimism. On ORS Nasco, it warned that if the deal didn't go ahead, "the directors believe that this is likely to have a significant negative. . . and could impair the realisation value in the future".

Certainly, that could be the immediate impact. However, wouldn't a strong commitment on the future development of that company erase all those doubts?

Reviewing the disposal of Eland, a distributor of electrical cables, the circular stated "if a disposal of Eland is not executed, the resultant group will be exposed to the ongoing trading performance of this business". Isn't that what all businesses, big or small, are exposed to?

Nevertheless, the considerations for the businesses have been reasonable and appear to have been in excess of the board's target. If the consideration for ORS Nasco had been under €70 million for example, the bonuses would have been at the discretion of Unidare's nominations and compensation committee.

But over that target the two senior executives were entitled to 5 per cent of the excess, with Jack Hayes getting two-thirds and Kevin Gallen getting the other one-third.

The consideration was €81 million, so the bonuses were also higher. The sale of Eland to that company's management for €5.9 million looked cheap when compared with its pretax profit of €1 million, but the consideration was at a premium to the net assets of €4.8 million. Unidare contends it was a fair price, considering it is a lumpy contract business and dependent on its management.

For their role in selling the three companies, Hayes gets €1.2 million while Gallen gets €600,000. Linked bonuses like these make a lot of sense as they provide a real incentive to get the highest considerations.

Normally, it would be a mournful day to see yet another publicly quoted company with traditional ties to the domestic market ceasing. However, the link with the home market ceased in 2002 when it sold Oerlikon, a welding group. At its peak in the 1960s, it employed more than 2,000 people in Finglas but often it was a can of worms. Since then, and up to its dismantling, its operations centred on the US, UK and the Netherlands.

The decision to sell off the operations has been both courageous and effective.