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Sunday, October 15, 2006

Consortiums battle to save Castlemahon plant

The 300 jobs hanging by a thread at Castlemahon foods could be saved very soon after it emerged there is two consortiums vying it out to save the company.

Today’s Sunday Business Post reports today that the two groups who are made up of suppliers to the plant have met with potential backers and a bid to buy the company could be made by both in the next 10 days.

The two groups had met as one last week to put together a package to save the plant but they have split and are now competing against each other for the €80m poultry processing plant.

More from the SBP,

The two consortiums have already held meetings with banks about securing capital, while contact has also been made with Shannon Development, the regional development authority, in an effort to secure grants and funding.

It is not known how much they intend to offer for the company. It is understood that no other trade buyers have come forward and the company’s chances of survival now hinge upon a deal with the poultry suppliers.The producers have a significant stake in the company’s survival. Most of them depend on Castlemahon and have no other customers.

The company went into provisional liquidation three weeks ago after amassing debts of more than €20 million. Castlemahon is owned by the O’Kane Group, an Antrim-based food group that has interests on both sides of the border.T

he O’Kane Group is owed about €16 million by Castlemahon, but has agreed to write off those loans to help secure a buyer.

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