Latest news with #KieranWallace
Irish Times
15-07-2025
- Business
- Irish Times
Cityjet has until next month to secure rescue
Troubled airline Cityjet has until mid-August to secure a rescue deal after the High Court extended an order protecting the carrier from creditors on Tuesday. Mr Justice Michael Quinn extended the court's protection and the appointment of joint examiners Kieran Wallace and Andrew O'Leary of specialist firm, Interpath Advisory , to August 16th. Lawyers for the examiners told Mr Justice Quinn that the matter was 'quite complex' and likely to take the full 100 days that the law allows to engineer a rescue deal. Mr Wallace and Mr O'Leary indicated shortly after their initial appointment in May that they were in talks to possible investors in the airline, which provides aircraft and crews to SAS and Lufthansa to fly regional routes in Europe. READ MORE Cityjet sought protection and the appointment of examiners in May after hitting difficulty paying creditors. However, an independent report on its finances said that the business had a reasonable prospect of survival if it were placed in examinership, as the rescue process is called. Examinership allows court appointed examiners up to 100 days to devise a rescue plan for a troubled company. The court provisionally listed the issue for hearing on August 14th.
Irish Times
06-06-2025
- Business
- Irish Times
Unions to meet with Wellman examiner to discuss possible sale
Unions representing about 200 of the 217 staff at the Wellman recycling plant in Mullagh, Co Cavan will meet with examiner Kieran Wallace of Interpath Advisory on Monday as part of an effort to find a buyer for the facility and prevent job losses. The unions say the plant has considerable untapped potential and safeguarding it and its workforce should be a particular priority for government given its environment significance. Its parent company, Indorama Ventures, says it has lost 'double-digit millions across 2023 and 2024' and needs to be financially restructured. Mr Wallace, of Interpath Advisory was appointed interim examiner on Tuesday. Having opened in 1973 under American ownership, the facility in Mullagh was taken over by Thai based Indorama Ventures in 2011. At one point it employed more than 500 people and the unions claim it has been run down by its current owners. READ MORE The factory recycles plastic bottles and other waste and is capable of producing polyester fibres and other products including car components. Union representatives briefed local TDs on what they believe is the potential of the plant on Thursday evening and hope to persuade the examiner to allow them speak with prospective buyers. A meeting with management is also scheduled for next Wednesday. 'I think the hope would be that Government would take a particular interest is saving the plant given the context of Ireland's recycling policies,' said Michael O'Brien of Unite. 'The examinership did not come as a huge surprise to the people working at Wellman but they are not fatalistic about the situation at all and they want to be involved in the process to find a buyer because they believe they can help highlight its potential.' Indorama, which operates a large network of facilities internationally has cited high energy costs and competition from China and other regions. It has said its board believes the plant 'does have a potential future'. It says, however, that some jobs may be lost during the examinership process and there is concern among the three unions with members there, Siptu and Connect as well as Unite, that the terms offered may fall short of previous voluntary packages. Siptu's Alan Clark said he is optimistic a buyer can be found to take the operation over as a going concern. 'It's a very versatile facility and we certainly believe there is the potential for it to continue.' Despite the number of jobs at the site having reduced over time, Wellman remains a major employer in Cavan and important to the local economy.
RTÉ News
03-06-2025
- Business
- RTÉ News
Job cut fears as Cavan's Wellman International to enter examinership
There are fears over possible job cuts at Wellman International after it filed a petition with the High Court to place its operation in Mullagh, Co Cavan into examinership. Wellman International employs 217 people and is the largest European producer of recycled polyester fibres. It began operations in Mullagh in March 1973 and the site was acquired by Indorama Ventures in 2011. The company said Wellman has seen losses in the double-digit millions across 2023 and 2024, resulting from increased energy prices following geopolitical conflicts and fierce competition from low-priced imports from China, Africa and Middle East. "Nevertheless, the board believes that the operation does have a potential future and accordingly has elected to apply for examinership," the company said in a statement. Kieran Wallace of Interpath Advisory has been appointed as interim examiner and will engage with all stakeholders. If his appointment is confirmed by the High Court, he will continue efforts to devise a workable survival scheme. Anthony Troy, director at Wellman International, said that while examinership gives the company the best prospect of retaining as much employment as possible, it is important to acknowledge that there is the potential for a reduction in headcount as part of the process. "This decision is no reflection on the hard work and commitment of our employees in Mullagh," Mr Troy said. "We are aware of the uncertainty and concern this will cause for our people as we attempt to secure the survival of the company. For more than two years, management has taken action to cope with the situation. "Unfortunately, these measures have not proved sufficient to overcome the challenges we are facing," he added. The Mullagh factory manufactures recycled polyester fibres from used plastic materials. The fibres have a wide variety of industrial uses including in the automotive, home, leisure and hygiene sectors. Indorama Ventures is listed in Thailand is a petrochemicals producer, with a global manufacturing footprint across Europe, Africa, Americas, and Asia Pacific.
Irish Times
31-05-2025
- Business
- Irish Times
Three times unlucky: Cityjet finds itself seeking protection from creditors again
Irish-based airline Cityjet is back under High Court protection from creditors, for the third time in its 33-year history. Mr Justice Michael Quinn confirmed the appointment of Kieran Wallace and Andrew O'Leary of specialist firm Interpath Advisory earlier this week as examiners to the carrier. They have up to 100 days to devise a rescue plan for the business, which has €7.7 million in cash and creditors who are seeking €13 million. An independent report on its finances by Damian Murran of Teneo Restructuring Ireland says its net liabilities were €38.5 million at the end of February. Much of that consists of payments due under aircraft leases, so does not fall due immediately. Mr Murran points out that net liabilities would increase to €66 million as a consequence of examinership, including €18.7 million due to unsecured creditors. However, he states that liquidation would increase the amounts owed to €177 million. READ MORE This is partly because liquidation would trigger big penalties under the airline's contracts with SAS and Lufthansa, adding significantly to the amounts due to its creditors. [ More turbulence at Cityjet as interim examiners called in Opens in new window ] While the company remains under the court's protection, creditors cannot enforce any debts. The 'examinership' process is designed to allow financially troubled companies with a reasonable chance of survival stay in business. Cityjet last went into examinership in April 2020, a month after Covid-19 curbs grounded global air travel. It emerged the following August. The first time it did so was in 1996. Run by chief executive and founder Pat Byrne, who is no longer a shareholder, Cityjet flies regional routes for Scandinavian airline SAS and Germany's Lufthansa. It uses its own aircraft and crews for this, a practice known in the industry as wet leasing. It began focusing solely on this business in 2018, deciding to no longer operate its own scheduled services in a move designed to cash in on opportunities it saw emerge as bigger carriers sought ways to maintain less lucrative regional routes while they concentrated on longer routes. [ Dublin-based CityJet reports loss of €16.8m in 2023 Opens in new window ] Cash flow forecasts in the report show that the company can trade through the 100-day examinership while paying its workers and suppliers critical to keeping the business going. Cityjet's current problems are rooted in the decision of key customer, SAS, to enter Chapter 11 bankruptcy in the United States in July 2022. Not unlike examinership, Chapter 11 is a federal court-supervised process that allows companies facing financial problems restructure their debts and capital so they can stay in business. Airlines based outside the US have used this process in the past. SAS originally expected Chapter 11 to take around nine to 12 months, but it ended up lasting two years. That limited SAS's scope to make longer-term commitments to Cityjet, leaving the Irish group with no certainty on its arrangement with the Scandinavian group beyond October 2023. During that period, SAS also contracted some routes to a Cityjet rival, Estonian carrier Xfly, aggravating the Irish group's problems. Consequently, Cityjet began to focus more on providing services to Lufthansa in 2023. Cityjet, which is based at Dublin Airport, employs more than 580 people in Ireland, Britain, Denmark and Sweden. It is unclear how many jobs would be lost in any restructuring. Photograph: Nick Bradshaw Those routes were seasonal. The cost of laying off crew and mothballing aircraft for the winter, and then returning them to service for the summer, was prohibitive. Instead, Cityjet kept planes and crews in service. That cost it €13 million, according to Mr Murran. Last year, the airline began talks with Lufthansa to establish a long-term commercial relationship, spending cash on boosting its workforce, compliance and maintenance in anticipation of a big contract extension. It even drew up plans to increase its fleet. The pair agreed initial terms late last year. However, in January, Lufthansa told Cityjet that its board had decided on a new strategy. Not only was the German group not going ahead with the extended wet-leasing deal, it said it was terminating its current contract in October. That removes around one-third of Cityjet's business. As this was going on, SAS finally emerged from Chapter 11 in August last year with $1.2 billion in fresh investment. However, the lack of a long-term deal with SAS prompted Export Development Canada (EDC) to sell 14 Bombardier planes, leased to the Irish group, to American Airlines, agreeing short-term lease extensions and a delivery schedule up to April next year for the aircraft. This will cost Cityjet €21.6 million up to that date, stemming from terms in the leases covering engine overhauls. That figure would have been higher but EDC agreed to amend those terms, cutting the liability by €20 million. However, Mr Murran points out that as Cityjet has not paid the Canadian company since February, it risks a breach of contract and a 'reversal' of the deal to cut the liability by €20 million. EDC is listed as a creditor, through CJF Aviation, for €1.9 million. EDC is one of the parties with which Mr Wallace and Mr O'Leary will be negotiating through the examinership. On Monday, the High Court heard it was not objecting to Cityjet's petition for protection from creditors. SAS will also loom large in the process. That group agreed a new four-year deal with Cityjet in October 2024. It is the largest user of wet leasing among European airlines. Lawyers said on Monday that it would continue doing business with Cityjet through the examinership. Any new business plan will focus on flying routes for SAS while potentially expanding the current agreement. There may be some headroom for this as Xfly, the Estonian carrier that took some of the Irish group's routes, has filed for bankruptcy. But Cityjet will be smaller. As things stand, it employs more than 580 people across the Republic, the UK, Denmark and Sweden. According to Mr Murran, 116 of those are based in Ireland, with eight in Luton, and 461 working for its Danish subsidiary, Cityjet AS. [ Investors circle troubled Cityjet Opens in new window ] Some of those jobs will be lost, but nobody knows where or how many at this point. New investment seems certain to play a part in any rescue. The examiners' lawyers told the High Court this week that some – as yet unnamed – potential backers have expressed interest since their interim appointment on May 8th. One possibility is that the larger of its current shareholders, Spanish group Air Investment Valencia, which is controlled by businessman Carlos Bertomeu, could reinvest in Cityjet. Air Investment Valencia owns 80 per cent of Cityjet as it is, through a holding company, Strategic Alliance of Regional Airlines, which owns Cityjet and Spanish carrier, Air Nostrum, along with aircraft maintenance and service companies. From left, Miguel Angel Falcon and Carlos Bertomeu of Air Nostrum, and Cityjet's Pat Byrne and Cathal O'Connell at the announcement in 2023 that the two regional airlines were joining forces Cityjet owes Air Nostrum's maintenance arm €2.3 million, making the Spanish business one of the biggest individual unsecured creditors. Irish company CF Miga owns the remaining 20 per cent. That business is also a secured creditor as Cityjet owes it €400,000 from a €1.9 million loan given in 2020. Creditors are likely to take a hit in any scheme of arrangement, as examiners' rescue plans are known. The law allows examiners a lot of scope to restructure debt. In addition, once the scheme is supported by any single group of creditors that loses out as a consequence, the court can approve it. Mr Justice Quinn acknowledged on Monday that this was the third time that Cityjet had sought the High Court's protection and gone into examinership. However, he argued that this was 'no bar' to the company availing of the process again, as it faced new difficulties and challenges.
Irish Independent
28-05-2025
- Business
- Irish Independent
Slieve Russell Hotel made loss prior to last year's sale but outlook is more positive
New accounts for Slieve Russell Hotel Property Ltd show the company recorded a pre-tax loss of €1.46m in the 12 months to the end of June 2024. The pre-tax loss of €1.46m followed a very modest pre-tax profit of €9,000 in fiscal 2023. The 2024 pre-tax loss arose from interest payments almost doubling last year, from €1.84m to €3.35m. The company recorded the pre-tax loss despite revenues rising by 7pc from €19.05m to €20.43m. The loss at the hotel firm came ahead of the reported €30m sale of the 224-bedroom hotel last October by CBRE on behalf of the liquidators of the Irish Bank Resolution Corporation, Kieran Wallace and Eamonn Richardson of Interpath Advisory. The new owner is Brady Hotels Ireland, run by an Australian-based developer from Co Cavan. At the time of the purchase, Tony Brady said the Slieve Russell would continue to be run by a local team. He pointed out that the resort employs hundreds of people locally, both full and part time, and 'is an important part of the community'. With the collapse of the Quinn empire, the IBRC, formerly Anglo Irish Bank, assumed control of the Slieve Russell hotel when a share receiver was appointed to the hotel firm in April 2011. The business recorded operating profits of €1.88m in the 12 months to the end of June last, with directors stating that improved trading figures are a direct result of the capital investment programme which commenced in 2022 and continued throughout last year. The directors state that 'additional costs were incurred during 2024 in preparing the underlying assets of the company for sale'. They state that 'the outlook for 2025 is positive, and trading in 2025 is expected to be in line with 2024'. The directors state that the company has experienced significant inflationary increases, particularly in relation to payroll related costs. Numbers employed last year decreased by one from 272 to 271 as staff costs rose from €8.3m to €9.1m. The loss also takes account of non-cash depreciation costs of €1.4m. Aggregate pay to key management last year decreased from €718,000 to €673,000. At the end of June last, the firm owed €68.2m to the IBRC and, subsequent to year end, the directors state that the loan liability owed by the company to IBRC was settled in full under the terms of a settlement deed and allowed the hotel sale to be concluded. Other hotels that were once in the Quinn empire have also been sold in the last year by the IBRC. Hotel Prague was bought by a Czech property holding company, and Buswells Hotel on Molesworth Street in Dublin has been purchased by Roundstone Real Estate.
