HOUSE-BUILDING company Laragan Developments, which employs 50 people, is to be wound up after the High Court yesterday refused to approve a scheme of arrangement which was suggested to offer the company a reasonable prospect of survival.
Mr Justice Frank Clarke refused approval for the scheme on grounds including his concern about the relationship between Laragan and Alan Hanly, of the Hanly group, and that Laragan was a “vehicle of convenience” for Mr Hanly.
Laragan, part of the Hanly group of construction and quarrying companies, has liabilities of €147 million and assets worth €2.35 million. The court heard €101 million of Laragan’s liability is owed to Alan Hanly. Other main creditors include Anglo Irish Bank, a secured creditor, AIB, and the Revenue Commissioners.
The survival scheme was proposed by Paul McCann, a partner with Grant Thornton who was appointed examiner to Laragan last March. The examiner had sought additional finance to ensure the survival of the firm, and the total he had been able to secure in a bank loan and from Alan Hanly came to €2.95 million.
Under the proposed scheme, creditors were to receive between 30 per cent and 1 per cent of what they were owed, while trade creditors were to get a minimum of 6.4 per cent of what was due.
About 100 people who paid deposits of €15,000 to €20,000 for properties at Carrickmines Green in South Dublin and Milner’s Square in Santry would have received just 1 per cent back.
A majority of the different classes of creditors had voted in favour of the proposed scheme.Some creditors who attended last week’s hearing of the application to approve the scheme urged the judge to refuse approval so a liquidator might carry out a full investigation into Laragan’s affairs.
Mr Justice Clarke stayed his decision to this morning in the event of an appeal.