Family-run Lynch Hotel Group goes into examinership with debts of €23m

WITH debts of almost €23m the Co Clare-based Lynch Hotel Group, which employs 450 staff, has gone into voluntary examinership and has been placed under the protection of the High Court.

Yesterday at the High Court Ms Justice Mary Finlay Geoghegan appointed Michael McAteer of Grant Thornton as interim examiner of Ireland’s largest family-run hotel group, which owns and manages a number of hotels in the Connacht and Munster area.

The judge appointed Mr McAteer after being informed that an independent accountant’s report showed that the group had a reasonable prospect of survival as a going concern.

The court heard that the group was in debt to the amount of €22.85m, a sum it is unable to pay.

The hotels operated by the group include the West County in Ennis, the Clare Inn in Dromoland, Co Clare, The George Boutique Hotel in Limerick, The Breaffy House Hotel & Spa, the Breaffy Woods Hotel and Breaffy Suite in Castlebar, Co Mayo, and the Ocean Cove Hotel in Kilkee, Co Clare.

The petition to have an interim examiner appointed to the group was made by Michael B Lynch, Kilone Grove, Ballybeg, Ennis Co Clare, who has been the Lynch Hotel Group’s managing director since 1996.

The directors of the firm are Michael B Lynch and Michael Lynch Senior.

The main creditors are the Revenue Commissioners, AIB, Bank Of Scotland (Ireland), Bank of Ireland, Diageo Ireland and Celtic Linen Ltd.

The group gave a number of reasons as to why it got into financial difficultly, saying that occupancy rates at the Breaffy House Hotel had been much lower than hoped for, and that leasing agreements entered into with the landlords of some of the hotels are unsustainable.

It also said the group’s difficulties stemmed from the general economic downturn.

The hotel group was established in 1968 by Mr Lynch’s parents, along with the West County Hotel in Ennis.

A support line, on 1890 669900 and 065-6823000, has been set up to deal with inquiries.