High Court approves Mothercare survival plan

A survival scheme for Mothercare Ireland has been approved by the High Court.

More than 250 jobs have been saved and the company will continue to trade at 15 stores nationwide following a €750,000 investment from the company’s main shareholder David Ward.

Under the scheme, the company will continue to trade at 15 stores but three, Blackrock and Jervis St in Dublin and Cruises St, Limerick, will close early next year.

Mothercare says consultations are taking place with staff at these shops who will be deployed elsewhere if possible.

As part of the scheme, the company secured a rent reduction of 30% across its store portfolio but other stores that were potentially under threat will remain open following agreements on rent reductions.

Mr Justice Brian McGovern yesterday refused an application by the Revenue Commissioners for an adjournment of the matter to allow them examine the investment scheme.

There were concerns the majority of investment would be eaten up by the examinership costs with less money available to creditors, Arthur Cunningham, counsel for Revenue, said. Revenue is both a preferential and unsecured creditor.

Gavin Simons, solicitor for the examiner, said there was no reason why the court should not approve the scheme. It was not the case that if examiner fees were reduced, it would mean more money for creditors. It would just mean the investment would be reduced, he said.

Rossa Fanning, for the company, also said there was no reason for the scheme not to be brought to a conclusion now. Mothercare UK also supported the scheme, the court heard.

The company, and two related companies, Mothercare World and Effleby Trading Ltd, went into examinership last July.