MR Paul Wyse, of Oliver Freaney & Co, is likely to be proposed as examiner of Cornel Electronics, in the High Court today, according to industry sources.
The company which employs 85 people makes modems in a plant in Tallaght, Co Dublin, and ran into difficulties because of cost overruns and other problems associated with the development of a new product, according to Mr Brian O'Sullivan, acting chief executive.
However, Cornel is also understood to have faced more intense competition in an area where products rapidly become obsolete.
The company, he stressed, is not under any pressure from its creditors or banks but the examinership is needed to give it time to organise a financial restructuring. This is also likely to involve the injection of fresh funds into the company.
Cornel, one of the leading companies in the indigenous electronics sector, was set up in 1981 by Mr O'Sullivan, Mr Michael Maguire and Mr Joe O'Callaghan the chief executive who is on sick leave. The three, who set up the company after leaving Telectron, control 51 per cent of the equity but this is likely to be substantially reduced in a restructuring, industry sources said.
Individuals who invested in a business expansion scheme control 15 per cent.
Other investors include ICC Bank, with a 13 per cent stake, Irish Life, with 14 per cent, and Forbairt, which provided capital and training grants of £1 million, which has 7 per cent.
Cornel, in its application to the court, is likely to argue that it is basically a viable company. If the Ulster Bank and the Revenue Commissioners support the application, then the appointment of an examiner is likely. However, the sources said that there is no indication what approach they will take.
Cornel is understood to have made a profit up to 1994. After that losses were incurred. It has been generating annual sales of £6 million to £7 million.
Some 60 per cent of these sales came from a high speed data pump, the core piece of technology in the modem, developed by Cornel and which it sold to other manufacturers.
