SIAC secures protection of court

SIAC Construction Ltd and eight related companies, including the ultimate parent company in the 100-year-old construction group, have secured court protection to allow for preparation of a survival scheme.

The nine companies employ about 250 people full time and are “in a clear position of insolvency” arising from the economic downturn and losses resulting from SIAC’s involvement in Polish road building projects, the High Court was told yesterday.

Since 2008, the turnover of SIAC Construction Ltd (SCL) has fallen from €265m to €113m, the directors said in their petition. SCL also has trade creditors of €26.1m, additional current liabilities of €4.5m and other sums totalling €24.7m due in contract and rectification provision and intercompany liabilities. Polish creditors also had outstanding claims of some €7.4m.

The directors said SCL is under significant pressure from its trade creditors and any petition for its winding up would have a “catastrophic domino effect” on the group as a whole.

SIAC has, with others, taken legal action in Poland arising from involvement in road contracts and said the value of its share of those claims was about €113m.

The various companies are involved in continuing and completed projects and are believed to have a reasonable prospect of survival, Lyndon MacCann, counsel for the companies, said.

Ms Justice Mary Finlay Geoghegan agreed to grant protection to SCL and the eight other companies on the basis of reports from independent accountants expressing the opinion the companies have a reasonable prospect of survival as a going concern provided several conditions are met.

She also agreed to appoint Michael McAteer as interim examiner. It was hoped, amongst other tasks, Mr McAteer might help diffuse an “unfortunate” situation involving various sub-contractors blockading premises of SIAC Construction arising from their not being paid, Mr MacCann said.

Ms Justice Finlay directed the petition should be advertised in Ireland, England and Poland.

The affected companies are SIAC Construction Ltd; SIAC Holdings Ltd; SIAC Holdings (Ireland) Ltd; SIAC Bituminous Products Ltd; SIAC Butlers Steel Ltd; Lilymount Ltd; SIAC (Clondalkin) Ltd; SIAC Baldonnell Ltd and SIAC Property Retailers Ltd.