Troubled construction firm’s directors form new company

Date Published: 30-May-2011

BY ENDA CUNNINGHAM

Four former directors of Cordil Construction – which collapsed into receivership last week with debts of well over €30 million – are ‘going forward backwards’, after forming a new company called Lidroc Construction.

Lidroc was formed in mid-February and its four directors are Gerry Dillon, Padraig Higgins, Morgan Darcy and Tom O’Callaghan – all former directors of Cordil.

Meanwhile, the Receiver Manager’s staff began the lengthy process of trawling through Cordil accounts yesterday (Monday) morning and have already found that a series of contracts are tied up in arbitration.

Michael McAteer of insolvency specialists Grant Thornton was appointed as Receiver Manager over Cordil last Thursday night.

He is now also assessing the viability of ‘finishing out’ existing contracts, including the new arthouse cinema on Lower Merchant’s Road, the extension to the ‘Jes’ school and the new clubhouse for Hibernians Football Club.

All four directors of the new Lidroc entity (Cordil spelt backwards) were directors in Cordil, which was formed more than a decade ago by joint owners Gerry Dillon and Pat Corrigan.

According to documents filed with the Companies Registration Office on May 16, Tom O’Callaghan resigned as a director of Cordil, a change which was listed as having taken effect from last January.

On May 12, our sister newspaper, the Connacht Tribune revealed that Cordil had closed down its 15 sites around the country, with the loss of 51 direct jobs and more than 400 subcontractors’ jobs.

The company blamed restrictive clauses in Government contracts, and claimed to be owed around €4m by the HSE and the Department of Education for completed work and work in progress.

Attempts by the directors over the following fortnight to secure a temporary overdraft facility from bankers failed, and last Thursday, Mr McAteer was appointed Receiver Manager over the entire assets of Cordil by ACC Bank, which had a charge over all of the company’s fixed and floating assets.

Meanwhile, it has emerged that Cordil had suffered further cashflow problems because of a series of unpaid contracts which are tied up in arbitration and conciliation processes.

Read more in today’s Connacht Sentinel