A number of Irish retail stores in the Iceland chain will not reopen, which will affect a “large number” of employees, the High Court has heard.
An examiner appointed by the court to Metron Stores Limited, which operates the Irish stores, reported that about 160 employees had been temporarily laid off, while 12 of the 26 Irish stores had temporarily closed.
“All efforts” would be made to retain staff members, the examiner’s barrister, Stephen Brady, told the court on Friday. The company was following statutory steps and it was likely a collective redundancy process would begin in the coming days involving engagement with employees and unions, the court heard.
Joe Walsh, of JW Accountants, was appointed interim examiner to Metron in June, when the court was told the company was insolvent and unable to pay debts of about €36 million as they fall due.
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Among the company’s difficulties was a Food Safety Authority of Ireland (FSAI) order requiring it to withdraw from its Irish stores all frozen food of animal origin imported since March 3rd of this year. Metron has also suffered significant losses in the past two years due to a high cost base.
On Friday, the examiner’s barrister, Stephen Brady, said a preferred investor had been selected and, if finalised, the investment would bring significant working capital, protect employment and ensure sustainability.
Outlining Mr Walsh’s report, Mr Brady said four stores were temporarily closed around the time of the examiner’s appointment, while it was necessary to temporarily close a further eight “loss-making” outlets since then. Employees at these 12 stores, located in counties Dublin, Cork, Wexford, Donegal, Roscommon, Tipperary and Longford, have been placed on temporary lay-off. It is now clear that certain stores would be closed permanently, he added.
Mr Brady said the company had made good progress in dealing with various issues arising from the FSAI’s intervention and ongoing investigation.
He also told the court the examiner’s office had received about 100 claims from employees regarding potential amounts owed to them.
At the examiner’s request, Mr Justice Michael Quinn extended by one month the period under which the company is protected from its creditors.
There was no objection from the company’s creditors. Iceland UK’s counsel, Shelley Horan, said that her client had significant assets, including freezers, at many of the Irish stores. She stressed that her client had complied with all of its regulatory controls, while the Irish entity was responsible for its own compliance.
The case was adjourned to a date next month.
