The High Court appointed William O’Riordan as examiner to five McInerney companies after finding they had established a reasonable prospect of survival. The appointment followed the judge’s ruling on 13 September 2010; the reasons were set out in a judgment delivered on 24 September.
The application concerned McInerney Homes Limited, McInerney Holdings Public Limited Company, McInerney Construction (Holdings) Limited, McInerney Contracting Limited and McInerney Contracting Dublin Limited. Three banks—Anglo Irish Bank Corporation, Bank of Ireland and KBC Bank—opposed the appointment. The formal requirements were accepted as met, leaving the dispute over whether the businesses had a realistic prospect of survival.
The judgment said the group was insolvent after a property-market collapse led to asset write-downs exceeding €150 million. Its debt to the banking syndicate was more than €110 million. The judge considered a proposed €40 million investment by Oaktree Capital Management, alongside a restructuring of bank debt, and found the group’s business plan realistic despite the uncertainty facing housebuilding.
The judge concluded there was a reasonable prospect of resolving the group’s capital shortfall, while acknowledging significant obstacles. These included reaching acceptable terms with the existing banks or arranging alternative financing. A proposal that would require banks to continue lending against their wishes presented particular legal and practical difficulties; the judge expressed scepticism about that route and did not decide its legality.
The court also considered each applicant company separately. It found the companies continued to trade and that the business plan did not require any of them to disappear, although their operations might be reduced. On that basis, the judge was satisfied that each had a reasonable prospect of survival and that no other factor justified refusing an examiner.
The appointment was not a finding that a rescue had been achieved. The judge directed the examiner to report by 1 October on whether a realistic solution to the capital shortfall remained possible. The report was initially to be provided to McInerney and the banks, with a further hearing scheduled for 4 October to consider it.