Examiner to Four Star Pizza confirmed by court

THE High Court yesterday confirmed the appointment of an examiner to the Four Star Pizza takeaway and delivery chain after it heard an independent accountant had found it has a reasonable prospect of survival if certain steps are taken.

Neil Hughes, of Hughes Blake, who was appointed interim examiner earlier this month, was confirmed as examiner yesterday by Mr Justice Brian McGovern.

Four Star Pizza Ltd, and its holding parent company Zowington Ltd, sought the court’s protection because it was insolvent and unable to pay its debts.

The company has 40 stores and is the second largest take-out franchise in the 32 counties, employing 29 people directly and 400 indirectly, the court heard.

Rossa Fanning BL, for Mr Hughes, said in the last two weeks, the stores in Athlone, Cavan and Waterford had closed. The examiner was hoping as few stores as possible will be closed although it could be up to seven, he said.

Mr Hughes had met with key suppliers to ensure supplies would continue to the stores and also met with 22 franchisees, who had got a solicitor to represent them.

He met with landlords for stores which the company holds head leases on, and “real progress” had been made in relation to rent reductions, counsel said.

The court heard the company’s largest creditor, National Irish Bank (NIB), which is owed €4.9m, was adopting a neutral position on the examinership.

The Revenue was similarly neutral but was reserving its position in relation to a security created by the company last September in relation to financing from NIB, counsel for the Revenue said.

The court heard previously that while Four Star had made small profits last year and so far this year, its troubles were the result of increased competition, the downturn in the economy and the difficulty with franchisees being able to pay rents.

The company was the head tenant on most of the franchisees’ leases and had an obligation to pay rents which were not reflective of the market.