Receiver appointed over major building firmMay 26, 2011 - 8:00pm
BY ENDA CUNNINGHAM
ACC Bank has appointed a receiver over the assets of major Galway building firm Cordil Construction, which has debts estimated at more than €30 million.
Company chief Gerry Dillon has admitted the receivership is set to have a “severe impact” on those owed money – trade creditors are understood to be owed more than €6 million.
The bank moved to protect its position in relation to the company, after negotiations over the past fortnight for an overdraft facility failed.
Cordil employed 51 people directly, and more than 400 more subcontractors.
In a statement tonight (Thursday), Managing Director Gerry Dillon said: “Over the past fortnight since we temporarily suspended works on our sites, we have been in negotiation with our banks who in turn have tried to resolve the issue of a floating charge over the company by ACC Bank.
“We continued to approach Ministers, TDs and local councillors to generate support and highlight the impact on suppliers and subcontractors should we fail to obtain temporary working capital.
“We must inform you that ACC Bank have appointed a receiver to Cordil Construction. Unfortunately, a solution could not be found and we regret the severe impact that this situation will have on our suppliers, subcontractors, their staff and families,” he said.
As revealed by the Galway City Tribune a fortnight ago, the company ran into serious cashflow difficulties and closed down its sites around the country – including work on Coláiste Iognáid, the Solas arthouse cinema project and Hibernians Football Club in the city.
Cordil is owed in the region of €4m for contracts with the HSE and Department of Education.
The most recent accounts for the company (up to December 2009) show creditors are owed a total of €27.5m.
The company’s €21m in bank debt is secured against developments in Furbo and Ballindooley in Galway, as well as in Sligo; personal guarantees of €1.7m; mortgage over 15 apartments at Cúirt and Dolain in the Claddagh and an adjacent site and other guarantees given by Mr Dillon and Mr Corrigan.