The High Court has appointed a provisional liquidator for insolvent technology company Altada Technology Solutions Ltd.
Last week a creditor of Datech Ltd applied for the appointment amid fears that its assets would be sold by a recently appointed trustee. Datech is owed €100,000 after taking on unsecured loans granted to Altada but which defaulted last March.
Datech feared that newer investors who put €500,000 into tech company Cork before then appointing the receiver would have an unfair preference over other older creditors in how the company’s assets were distributed in a resolution.
The High Court last week ordered that the application to appoint the temporary liquidator should be brought to the attention of the company and other creditors and the matter returned to court on Tuesday.
Judge Brian Cregan heard there were appearances on behalf of other creditors, including proceeds owed €1.9 million from the receiver and the company itself.
Some of his employees and two directors also went to court and supported the sale by the receiver, but opposed the appointment of the interim receiver.
The judge was told that the company accepted that it was insolvent but favored voluntary liquidation by creditors. The bankruptcy trustee, Nicholas O’Dwyer of Grant Thornton, was neutral on the winding-up motion but wanted the sale, for which bids are due to close this Friday, to go through as planned.
Revenue said it neither supports nor opposes the dissolution but is concerned that the resulting debt would decline over a long period of time.
One of the other creditors, Nicholas Investments, said it had no objections to the resolution.
After submissions on behalf of the petitioner, creditors and the trustee, Mr Justice Cregan said he was satisfied that the legal tests justifying the appointment of an interim trustee had been met.
These included that there must be reasonable prima facie evidence of the winding up and whether there was a serious risk that the company’s assets would not be available in the event of such a winding up.
The position here is that a receiver has been appointed, the business is for sale and the sale is scheduled to close on December 30, and the assets may not be available in the circumstances, the judge said.
It was clear to the court that the assets might not be available, he said.
The liquidator was appointed in relation to a €500,000 loan and while Datech feared this would give those creditors an unfair advantage, it was not for the court to rule at this time, he said.
However, he noted that the €100,000 loan owned by Datech was called last March and that the €1.9 million in proceeds appears to have dated back to 2020, well before the trustee filed in September last year was appointed.
https://www.independent.ie/business/irish/high-court-appoints-liquidator-to-cork-tech-firm-altada-technology-solutions-42217710.html High Court appoints liquidators for Cork tech company Altada Technology Solutions