AN INTERIM examiner has been appointed to Buy & Sell, the classified advertising paper and website, after it was unable to restructure debts of €18.3 million to National Irish Bank (NIB).
Ms Justice Mary Laffoy appointed accountant Tom Kavanagh of Kavanagh Fennell to three firms behind the classified adverts business – BS, Buy & Sell (Northern Ireland) and Naldin on an application by its directors.
Noel Boyle, executive chairman of Buy & Sell, told The Irish Timesthat the business was "fundamentally profitable" but that it had been unable to service its bank debt and working capital needs.
The company said in a statement that significant attempts to restructure its debt with NIB had failed and that the directors felt the best course of action was to place the business into examinership.
Mr Boyle said the company owed a further €1.6 million falling due to trade creditors. The court heard that Harmsworth Printing is owed €388,000, while Webprint Concepts is owed €117,000.
The three directors of Buy Sell are Mr Boyle, financier Niall McFadden and Declan Cassidy.
Buy & Sellwas purchased in 2007 from Associated Newspapers by investment firm Boundary Capital, which was set up by Mr McFadden and is listed on IEX and AIM, the junior markets in Dublin and London respectively.
Mr Boyle said the business was acquired for €28 million funded by cash reserves of €7.7 million in the business and borrowings of €21.3 million from NIB.
He said he hoped to launch a bid for the business with other investors to be sourced by corporate finance firm Raglan Capital which would take it out of examinership. He said he had the support of the board to launch a bid.
Mr Boyle is also a director of Prontaprint and publishers CJ Fallon, two companies in which Boundary had made investments.
He said the circulation of Buy & Sell, which is published three times a week, fell by 52 per cent to 40,000 since last year, but visitors to its website had grown to 572,000 from 237,000 last year.
Mr Boyle said the company employed 64 people in Donnybrook, Dublin and that he was hopeful he would be able to retain as many of the jobs as possible.
Rossa Fanning BL, for the companies, said the directors believed the business could survive as a going concern if a scheme of arrangement was put in place.
He said the bank debt had been “a millstone” which had continued to cause difficulties.
The court heard that the company’s troubles also arose because of the recession, a debt of €500,000 owing to the Revenue and litigation involving two executives following the change of ownership in the business in 2007.
It is proposed, to reassure customers, that a trust account will be set up into which advertising money would be paid. If efforts to secure the company’s future failed and the advertisements were not published, the money could be returned, Mr Fanning said.
The court heard that there would only be a small return for secured creditors if the company was wound up and that the firm was vulnerable to actions by creditors unless it had court protection.
The firm had been threatened with liquidation by the Revenue. The matter will be before the court again on July 8th.
