Altada Technology Solutions, the Cork-based artificial intelligence company that collapsed into liquidation over recent months, owed some €8.6 million to creditors, including close to €637,000 in back pay to employees who have not been paid in five months, documents read in the High Court have shown.
On Wednesday, Mr Justice Brian Cregan made an order confirming John Healy of Kirby Healy Chartered Accountants in Dublin as liquidator to the company after his appointment on a provisional basis by the court last December.
Senior management had expected Altada to achieve a $1 billion (€930 million) valuation in 2022 after it raised $11.5 million in a funding round in September 2021, led by Rocktop Partners along with Elkstone Partners and Enterprise Ireland. The company’s founders, husband and wife team Alan Beechinor and Niamh Parker, were shortlisted for this year’s EY Entrepreneur of the Year awards.
But in a statement of the company’s financial affairs, Mr Healy said that Altada had total assets of €3.3 million, €849,261 of which related to intellectual property, as of December 15th. However, just over a quarter of the €3.3 million total is expected to be realised over the course of the liquidation of the company, which was described in court as “heavily insolvent”.
[ Receiver agrees sale of Altada to tech entrepreneur for more than €3mOpens in new window ]
Mr Healy’s initial investigation concluded that Altada had been defaulting on its creditors for some 12 months before his appointment. He said the company began to run into financial difficulties just months after it exited an examinership process in late 2019.
Altada owed some €2.8 million to its preferential creditors at the time of Mr Healy’s initial appointment, the bulk of which was unpaid back taxes amounting to more than €1.6 million. It owed more than €5.3 million to unsecured creditors, including close to €3.4 million to legacy trade creditors, who are unlikely to receive payment.
It also owed €500,000 to three secured creditors who had provided debt financing in the same amount to the company last September. Mr Justice Cregan described as a “most unusual feature” of the loan an agreement by the company to pay an additional €500,000 sum, described in court as a “premium”, on top of the principal after the eight-month loan period expired.
Mr Healy’s provisional investigation into the company also raised “weighty concerns” about certain items of expenditure and the use of company funds by directors, including round sum expense payments and payments related to travel, the court heard.
Last August, Altada announced that it had furloughed a number of staff on “temporary” basis due to “unforeseen market conditions”. The company had plans to grow its headcount to 100 before it faced financing issues following delays to a planned funding round earlier this year.
Its future will be decided over the coming days after a receiver appointed by creditors of the company last year agreed to sell Altada to tech entrepreneur Eoin Goulding, founder and group president of cybersecurity firm Integrity360.
The sale will only conclude if a legal wrangle between the company’s liquidator and the Revenue Commissioners on one side and its receiver on the other can be resolved over the coming days. The matter is listed for hearing in the High Court on the morning of Monday, December 16th.
