Lowry company is `captive' to Dunnes Stores

STREAMLINE Enterprises, the family company of Mr Michael Lowry, is a "captive company", under constant pressure to provide services to Dunnes Stores at increasingly efficient rates, according to a source close to the former minister. "It is more like a division of Dunnes Stores than a separate company," said the source. "It's like a service department."

A recent investigation carried out into Streamline by a credit rating agency, on behalf of another refrigeration company, reported that "no credit experience could be traced in likely trading circles". This means no trace of purchasing by Streamline could be found among likely suppliers.

The company is constantly under pressure to deliver improved services and "increased profits for Dunnes Stores". It is engaged in the design services, the supply of refrigeration cabinets and their maintenance. Mr Lowry has, in his personal capacity, engaged in consultancy work for Dunnes, designing refrigeration systems, according to the source.

Dunnes Stores advanced credit to both Mr Lowry and his company. This was a common practice with companies locked into servicing Dunnes during Mr Ben Dunne's period as head of his family's business. "They support a lot of companies on this basis. They give them soft loans to get started and then put them under pressure."

Mr Lowry established Streamline Enterprises in September 1988. At the time, the Dunnes contract was still with Butler Refrigeration, a company with which he had worked for many years and where he was the second most senior figure. The transfer of the Dunnes contract to Streamline came as a shock to Butler Refrigeration and the Butler family.

Streamline Enterprises was set up when demand for refrigeration services was booming. EU regulations covering food refrigeration and the Montreal Protocol which calls for changes in the gases used in refrigeration systems caused a rise in demand for such services.

Mr Lowry's company has the most lucrative contract in the business in Ireland. While other major refrigeration companies tender for contracts put out by individual out lets or shopping chains, Streamline Enterprises has an almost exclusive agreement with Dunnes Stores.

Dunnes Stores has approximately 70 grocery outlets in the Republic and a further 20 or so in Northern Ireland. The bill for fitting out an average sized super market with a refrigeration system would be around £500,000, according to trade sources.

The Streamline Enterprises contract with Dunnes is reportedly worth between £5 million and £5.6 million annually. Streamline employs 13 people and is run by Mr Lowry's brother, Pat.

. The latest accounts lodged in the Companies Office for Garuda Ltd, trading as Streamline Enterprises, show Garuda owing more than £630,000 to creditors at the end of 1995, with £571,848 of this falling due within one year.

The company has issued 100 £1 shares, of which 99 are owned by Mr Lowry and the other by his wife, Catherine.

From balance sheets it appears the company made a net loss of £25,935 in 1995; a net profit of £14,755 in 1994; a net loss of £4,588 in 1993; a net loss of, £18,557 in 1992; a net profit of £2555 in 1991; a net loss of, £32,586 in 1990; and a net profit of £11,275 in 1989, the first year of trading.