City company goes to wall with debts of almost Û20m

Date Published: {J}

By Enda Cunningham

A Galway development company has collapsed into liquidation with debts of almost €20 million.

At a creditors’ meeting for Marcon Developments yesterday morning (Monday), insolvency specialist Kieran Wallace of KPMG was appointed liquidator.

Meanwhile, director Shane Connolly has moved to distance the company’s collapse from the four-star Clayton Hotel, which he also owns, stressing the companies are totally separate and there is “no threat whatsoever” to the Ballybrit hotel.

Marcon Developments was also responsible for developing a residential development of houses and apartments in Briarhill, the Oranmore Dairies site, as well as a retail and residential development in Oughterard, which has been abandoned.

Apologising to creditors, Mr Connolly – who himself lost almost €8m in the collapse – said the company was hit by the economic slump, and a lack of funding.

Among the creditors are John and Fiona Grealish (of Cuba Nightclub and the Harvest off licence chain), who are owed just over €950,000 – some €238,000 of this is ‘secured’ debt.

Mr Connolly told the Sentinel: “I tried to get things back on track, and worked extremely hard for the last two or three years, but it became apparent that the company couldn’t continue.

“I apologise to the creditors, and I’m the second largest creditor, for what has happened, and I accept responsibility. I know some of the creditors on a personal level and have great relationships with them, so it’s particularly difficult.

“We were hit by the property crash, and the value of the Oughterard site took an unmerciful hit. I put every effort into it and heart-wrenching amounts of time and money,” said Mr Connolly.

It is understood that KBC Bank was supportive of Mr Connolly’s attempts to save the company, but he was unable to reach an

agreement with John Sisk & Sons – which secured a €2m judgment against Marcon in the Commercial Court last year – in relation to Oughterard.

Read more in this week’s Connacht Sentinel