A Louth-based businessman is threatening to sue Ulster Bank for €25 million following its decision last January to appoint a receivership to his business. Mr Derek Younger, managing director of fish processing groupRed Sail, said he was seeking legal advice on the matter.
The firm had been in operation since 1976 and employed around 160 people at its headquarters in Clogherhead, Co Louth. Nearly 100 people worked at its plant in Kilmore Quay, Co Wexford and 11 at its facility in Galway.
It is understood there are no plans by the receiver for an immediate return to full production at the plants and most of the staff have been laid off.
The decision by Ulster Bank - understood to be owed in the region of €7.5 million - to appoint a receiver came as a surprise to staff and suppliers, who had received no indication of Red Sail's financial difficulties.
Mr Younger claimed he could have covered the amount owed to the bank through stock and debtors. He also said the company had made losses in the past number of years due to the bank's interference in his management of the company. He said the bank had pressured him into selling prawns six weeks ahead of the normal selling season and at a disadvantageous price.
The losses accruing from this had a knock-on effect on the company's new battered, breaded and frying line, which was installed at Clogherhead following heavy investment, he said.
He also said the bank had cut his overdraft facility by €1.5 million at short notice.
"I am suing the bank for €25 million - that's my personal estimate of the replacement value for Red Sail Clogherhead, Red Sail Kilmore and Red Sail Galway," said Mr Younger.
A spokeswoman for Ulster Bank said it did not comment on individual customer accounts.
"We know these allegations are being made and what Mr Younger's plans are, that he is saying he will sue us, but owing to customer confidentiality we are unable to discuss it," said the spokeswoman.
"We exhaust every avenue to avoid receivership. So, we will have tried everything and gone down every avenue before receivership will have taken place." She said this applied to Red Sail.
