26 Jun 2022

High Court examiner confirmed at Kildare-based Sammon Group as company left in trouble after Carillion collapse

Group is owed €8 million for work on schools by entity which included collapsed UK building giant Carillion

High Court examiner appointed to Kildare-based Sammon Group as company left in trouble after Carillion collapse

The Sammon construction site at the Maynooth Education Campus

The High Court yesterday confirmed the appointment of an examiner to building contractors the Sammon Group which got into difficulty over the devastating collapse of UK construction giant Carillion.

The Irish group, which is involved in several major school building projects in Ireland, sought the protection of the courts and is owed some €8m by an entity involving Carillion.

Earlier this month, Michael McAteer of Grant Thornton Ireland was appointed as interim examiner to the County Kildare-based Sammon Contracting Group and related companies Sammon Contracting Ireland Ltd and Miceál Sammon Woodcraft Ltd. Sammon has premises in Kilcock.

The court was satisfied to appoint Mr McAteer after an independent expert's report stated the companies have a reasonable prospect of surviving if certain steps are taken.

These steps include the examiner putting together an agreement scheme of arrangement with the group's creditors.

If that scheme, which Mr McAteer has up to 100 days to put together, is approved by the High Court it will allow the group continue to trade as a going concern.

The matter returned before Ms Justice the High Court on Monday when Ms Justice Miriam O'Regan confirmed Mr McAteer as examiner of the firms. There were no objections to the application. 

The group, which employs more than 216 people, was hired by an entity that included Carillion to build several education facilities in Ireland. These include the construction of schools in Carlow, Kells, Co Meath, Wexford and two in Bray Co Wicklow.

Other separate projects the group is working on include the Maynooth Education Campus.

It is also working on projects in Cork, Shannon Airport, Waterford and Dublin.

Seeking Mr McAteer's appointment last month, barrister Ross Gorman BL, for the group, said it was hired to build five schools and the Institute for education by an SPV that included Carillion, known as 'Inspired Spaces'. That contract was worth approximately €87m to the group, counsel said. 

His client was paid on a monthly basis after works commenced in 2016.

However, the collapse of Carillion with debts of over £1.5Bn has had "a devastating and immediate impact" on the companies, counsel said. Payments from the SPV to the Sammon companies ceased last December, counsel said, adding it was owed €8m by the SPV.

As a result, the group has been unable to pay its suppliers and subcontractors working on those projects.

The impact of Carillion had contaminated the group's other projects, the court also heard.  

The court heard the group is confident that following a successful examinership it will be in a position to complete its contracts on time and return to profitability.

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