AN INTERIM EXAMINER has been appointed to a group of companies that operate the well-known Dublin restaurant Dobbins, and the Becketts Hotel and restaurant in Leixlip.
The businesses employ some 60 people. The companies sought the protection of the court due to cash flow difficulties caused by loss of business contracts and historic bank debts.
While both the St Stephen’s Lane, Dublin-based restaurant and the 10-bedroom hotel and restaurant have a good reputation and a loyal customer base, the fact the companies assets were acquired during the height of the Celtic Tiger boom has left the group with a high level of debt.
At the High Court today, Justice Brian McGovern appointed insolvency practitioner Kieran Wallace of KPMG as interim examiner of four related companies – Dobbins Wine Bistro, Dobbins Holding Company, Camrue Holding Company and Camrue Catering.
The judge said he was satisfied to appoint the examiner after an independent report said the companies have a reasonable prospect of survival if certain steps are carried out, including the approval by the High Court of a scheme of arrangement with the group’s creditors.
As part of that scheme, the companies hope to restructure their bank debts, pay a dividend to creditors, secure new investment and enter into an open-market lease for the group’s premises.
The main creditors include the Revenue Commissioners and KBC Bank.
Peak prices
Seeking the appointment of an examiner, Ross Gorman, for the company, said its directors had been the restaurant manager and head chef at Dobbins. In 2005 they acquired the businesses, when property prices were at their peak.
They acquired loans from KBC of more than €3.2 million to buy the group and to carry out extensive works.
Turnover in the businesses increased in 2006 and 2007 but dropped due to the financial crisis in 2008, and dropped year on year to 2013, putting significant cashflow pressures on the group.
The group has been unable to pay back what is due to KBC and has not always been able to honour installment arrangements it had entered into with Revenue.
The loss of contracts to two other firms within the group, Cypress Catering and Cypress Events, which were liquidated in 2015, also have contributed to its financial difficulties.
These companies had provided catering services at several greyhound tracks and Punchestown Racecourse, as well as to events at Dublin Castle and Farmleigh House.
They had been responsible for serving guests including President Bill Clinton and Prince Charles. However after losing the contracts to provide catering at the greyhound tracks the group was unable to fulfill its obligations to Punchestown.
Counsel said while the companies’ turnovers have stabilised, the directors say the firms can continue to trade profitably into the future once they can resolve their debt legacy issues.
Written by Aodhan O Faolain and posted on Fora.ie
To embed this post, copy the code below on your site
have your say