THE HUGHES & Hughes bookshop chain has gone into liquidation with an estimated deficit of almost €15 million.
According to a directors’ statement of affairs, Hughes & Hughes owes about €9 million to its only secured creditor, Ulster Bank, which appointed a receiver to the company in February.
Employees (who are ranked as preferential creditors) are owed €250,000, while employment-related taxes of €148,000 are also due. Almost €560,000 is owed in local authority rates.
More than €6.4 million is owed to the chain’s numerous unsecured creditors. Within this category, the Dublin Airport Authority – the former landlord of the chain’s outlets in the capital’s airport – is one of the largest creditors, being owed almost €690,000.
The largest unsecured creditors include many well-known book publishers and distributors. Penguin Books Ltd is owed more than €300,000; Harper Collins more than €256,000; and Eason Menzies Distribution in excess of €296,000. Independent book wholesaler Argosy is due about €150,000.
A loan of €300,000 provided by the chain’s former managing director, Tony McEntee, is also outstanding.
The statement of affairs also shows the company’s assets had a book value in excess of €11 million, but it is now estimated that they would realise just €1.45 million.
Stock which had been worth €3.5 million has been written down to €700,000. According to the statement, most of the stock is subject to retention of title claims, whereby suppliers retain the contractual right to take back goods supplied.
A leasehold interest which had a book value of almost €140,000 is now estimated to be worthless.
Insolvency expert Kieran Wallace of KPMG was appointed as liquidator to the chain at a creditors’ meeting in Dublin’s Harcourt Hotel yesterday.
According to one creditor, the atmosphere at the meeting was “like a funeral”. He said he believed the company’s creditors “won’t get a penny”, but added that he wished the company’s founder Derek Hughes well.
Earlier this month it emerged that Mr Hughes had put together a group of investors in a move to reopen some of the chain’s Dublin stores.
The company went into receivership on February 26th.
