Housebuilder Laragan to fold

The High Court has refused to approve a scheme of arrangement to ensure the survival of house-building firm Laragan Developments. As a result of the company, which has more than 50 employees, will be wound up.

Laragan, part of the Hanly group of construction and quarrying companies, has liabilities of €147m and assets worth €2.35m.

The court heard €101m of Laragan's liability is owed to Alan Hanly of the Hanly group.

Mr Justice Frank Clarke had been asked to approve a survival scheme for the firm. Today the judge said that he was not satisfied to approve the scheme.

The main creditors of the firm include Anglo Irish Bank, who are secured creditors, AIB, and the Revenue Commissioners.

The scheme had been proposed by Mr Paul McCann, a partner with Grant Thornton, who was appointed as examiner last March.

The examiner had sought to get additional finance to ensure the survival of the firm. The total amount he was able to secure from a bank loan and from Mr Alan Hanly came to €2.95m.

Under the proposed scheme, creditors will receive between 30% and 1% of what they are owed. Trade creditors would at a minimum get 6.4% of what they were owed.

Approximately 100 people who paid deposits of between €15,000 and €20,000 for properties at Carrickmines Green in South Dublin and Milner's Square in Santry, North Dublin would have received just 1% back.

A majority of the different classes of creditors had voted in favour of the proposed scheme.

However some of the creditors who attended the last week's hearing of the application to approve the scheme had called on the court to refuse to approve the scheme in order to allow a liquidator carry out a full investigation in Laragan's affairs.

The judge put a stay on the winding-up order in the event of an appeal.

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