Target sale to rival may save many jobs

SOME OF the 398 jobs lost as a result of the liquidation of trucking company Target Express could be saved after the High Court approved its sale to a rival, Masterlink Logistics, yesterday.

Target ceased trading on Monday and the High Court appointed Michael McAteer and Stephen Tennant of Grant Thornton as provisional liquidators on Wednesday.

In the High Court yesterday, senior counsel Rossa Fanning, acting for the liquidators, asked for permission to complete “within hours” the sale of the company to Blanchardstown-based Masterlink Logistics Ltd.

Mr Fanning said Masterlink had offered to buy the goodwill, intellectual property rights including the business name, and the customer list of Target, for an undisclosed sum. Its offer was the larger of two made to the liquidators yesterday.

Masterlink has committed to re-employing as many staff as possible, but the court heard that depended on how much of Target’s business it could secure. The more business Masterlink could get, the more jobs would be saved.

The liquidators believed this deal was the best that could be secured and that it offered the best prospect of securing the business and employment, he said.

There was “a certain amount of hope” in the proposed transaction as there was no certainty what return would be secured. There was no viable alternative, he added. Mr Fanning also said the liquidators believed the company’s creditors would agree to the sale.

Mr Justice Roderick Murphy said he would extend the powers of the liquidators to allow them effect the sale.

Masterlink is headed by managing director John O’Regan.

The company was founded in Blarney, Co Cork, but moved its headquarters to Dublin. It employs 350 people. In the 12 months ended March 31st, 2011, it made €98,000 profit on sales of €24.6 million. Shareholders’ funds stood at €2.7 million.

The firm operates a specialised logistics service for the Dublin Airport Authority, managing deliveries to shops and other businesses based in the airport.

Masterlink competed with Target in a number of areas, including the delivery of clothes to high-street shops. Target’s biggest customer was the A-wear chain.

In a statement yesterday, Masterlink pointed out there was a “strong fit” between the two businesses and said it was buying the insolvent company because of the growth opportunities offered.

Target ceased trading after the Revenue Commissioners, owed €600,000 in social insurance contributions and PAYE deducted from workers’ pay, took the exceptional step of ordering Target’s three largest customers and its bank to forward directly to the tax authorities money due to the company.

It is thought Target owes €5 million to its single biggest creditor, British-based Close Brothers, an invoice-discounting specialist. The debt was secured by a charge over the company’s book debts – money owed to it by customers.

Bank of Scotland has appointed Brian Murphy and Michael Jennings of BDO Northern Ireland as administrators to Farnley Investments Ltd, Target’s Northern Ireland-based property holding company, and not Mr McAteer as was incorrectly stated in yesterday’s report.

Jim Hamilton has been appointed receiver of ASDA Property Holding, its property company in the Republic.