New investor to save some of Qualceram as liquidation looms

A NEW investor is set to save parts of the troubled bathroom fittings group Qualceram, but the plc itself is likely to be liquidated with no payout to shareholders.

Qualceram was placed under court protection from its creditors on both sides of the Irish Sea in April, when David Hughes was appointed examiner to the company, and the same firm took over as administrators of its British businesses.

Yesterday, the company said that four of its subsidiaries have signed a deal with an investor which will put money into its Irish operations, and which plans to continue distributing the group’s brands in Ireland and Britain.

The statement did not name the investor, but it is understood to be an international player in the construction sector.

It made no comment on Qualceram’s British operations.

The statement said that as Mr Hughes was unable to secure funding for the plc itself, he would apply to the High Court to have it wound up.

“The examiner has informed the company that it is highly unlikely that this process will result in any distribution to the shareholders of Qualceram,” it added.

Mr Hughes will apply to the court to have the examinership extended in the case of its four subsidiaries.

Before the investment deal can go ahead, creditors have to agree to a scheme of arrangement which the court must then formally approve.

Yesterday’s statement said that the examiner plans to call meetings with the group’s creditors in due course.

Qualceram ran into trouble as a result of the construction slump. Much of the company’s business was focused on supplying house builders.

It emerged earlier this year that the company had been in talks with its landlord, WM Carey, and its banks seeking the waiver of some of the conditions of its lease that would allow it to sell surplus property close to its Wicklow base in order to raise cash.

This would have resulted in its landlord being able to call in letters of credit for €2.6 million, obliging the company to pay WM Carey this sum. The group wanted this waived. The banks were involved as they issue the letters of credit.

Late last March the company acknowledged that these talks were “challenging”.

It subsequently de-listed its shares from the Irish Stock Exchange, which was a precursor to going into an insolvency process.