A Co. Kildare grain merchant, Edward Kavanagh (Maynooth) Manor Mills, Maynooth, which has alleged liabilities of more than £20 million (#25.4 million), has decided that liquidation is inevitable, the High Court was told yesterday. It is expected a liquidator will be appointed on Friday.

A provisional liquidator, Mr David Hughes was appointed last month by the court on the petition of Quinns of Baltinglass, Co Wicklow, a supplier of the company which claims to be owed £966,000. The application had been supported by 30 other creditors.

When the matter came before Mr Justice O'Neill yesterday, Mr John O'Donnell, for Quinns, said the company had tried to formulate a scheme of arrangement to avoid liquidation but it had now decided liquidation was inevitable.

Rather than have a court winding up, it had been decided to hold meetings on Friday next which were likely to end with a voluntary liquidation and with the appointment of Mr Hughes as liquidator. Mr O'Donnell said his clients had no objection to this approach. He asked that the matter be adjourned for a week to await the outcome of Friday's meetings. If there were a voluntary liquidation, then further action was unlikely.

At a previous hearing it was claimed Kavanagh's was "hopelessly" insolvent with liabilities of more than £20 million. It had assets of £14 million and admitted debts of £5.5 million.

The previous court hearing had been informed the company traded profitably until recent years but had suffered significant losses in the past year.