High Court will be asked for four Thomas Read companies to be wound up

THE HIGH Court will be asked on Monday to make orders for the winding up of four of the 14 companies in the Thomas Read group on the grounds they have no reasonable prospect of survival.

Ms Justice Mary Finlay Geoghegan yesterday fixed Monday for the hearing of the application by KieranMcCarthy, examiner to the group, for the appointment of a liquidator to the four companies, which are understood to operate The Life Bar, Irish Life Mall, Abbey Street, Dublin; Bodega in Dun Laoghaire, Co Dublin and Thomas Read’s in Smithfield, Dublin.

Meanwhile, Mr McCarthy is finalising survival proposals for the other 10 companies in the group. The judge heard yesterday that bids for the group have been advanced by a consortium, whose members were not identified, and by ACC Bank, the group’s largest creditor.

Lyndon MacCann SC, for the examiner, said his client had concerns whether the proposals advanced by ACC met certain requirements of the Companies Act 1990 related to formulating a scheme of arrangement and wanted the court to decide the legal issue involved.

The court heard the examiner’s concern related to the fact that ACC’s proposals involve the bank not seeking to enforce securities for monies advanced to the group and whether the Companies Act required, when a scheme of arrangement is approved, that a company be solvent from that date in being able to pay debts as they fall due.

Bill Shipsey SC, for ACC, argued the issue of which bid to accept was a commercial decision for the examiner and he should not be applying for the legal declaration sought.

After hearing legal submissions on the matter, the judge ruled the act requires that a scheme of arrangement must render a company solvent in the sense of being able, on the date the scheme comes into force, to pay its debts as per the scheme of arrangement as they fall due.

She stressed her decision was on a purely legal basis and involved no judgment by the court on the commercial merits of the ACC proposals or whether they met the requirements of the Companies Act.

Court protection for the companies in the group will now continue to February 24 while the examiner finalises the survival proposals for the 10 companies.

All 14 companies, owned by Sharmane Ltd, the parent company of the Thomas Read Group, have combined debts of e26m but most companies are trading profitably, the court has heard. The group employs more than 400 people.

The largest secured creditor is ACC Bank, owed e15.2m while the Revenue Commissioners are owed e2m; Ulster Bank is owed e5.6m; Allied Irish Bank e4.6m; Diageo Ireland,e1.1m and Lombard Ireland is owed e1m.

The group’s premises are all in Dublin and are: The Bailey, Duke Street; Searsons, Baggot St; Winding Stair, Ormond Quay; Globe, South Great Georges St; Ri Ra, South Great Georges St; Harbourmaster Bar, IFSC; Thomas Read, Parliament St; Pravda, Liffey St; Floridita, Abbey St; Dawson Lounge, Dawson St, Ron Black’s Dawson St; Thomas Read, Smithfield; Lincoln Inn, Lincoln Place; Bodega, Dun Laoghaire and eight bars at Dublin Airport.