The High Court has appointed a provisional liquidator to the Irish arm of the woman's fashion retailer Monsoon Accessorize.
The retailer, which operated 10 stores in Ireland and had 140 employees, sought the winding up orders in respect of both Monsoon Accessorize Ireland Ltd and its holding company Monsoon Accessorize Ireland (Holdings) Ltd.
The retailer specialised in women’s clothing and accessories.
Seeking the provisional liquidator’s appointment, Rossa Fanning SC, appearing with Stephen Byrne, for both companies said that while they had experienced trading difficulties in the recent past, Covid-19, which resulted in stores being closed, was “a game changer”.
The companies made losses in 2018 and 2019, but the predicted loss in revenues arising out of the shutdown were expected to be very significant, the court heard.
Sales figures for the period March 1st to date for 2020 were down about 92 per cent from the same period last year.
Counsel said that, earlier this month, the company's ultimate UK parent, Monsoon Accessorize Ltd, had entered into administration. Counsel said that as part of a pre-pack arrangement, a company called Adena had taken over Monsoon Accessorize Ltd's business and assets.
Counsel said Adena was linked to Peter Simon, a Swiss-based businessman who was the founder of Monsoon group in 1973, as well as being a director of the two Irish companies.
Counsel said that as a result of the parent going into administration, the liabilities of the Irish companies had been impacted, particularly in regards to some leases of the Irish-based stores.
Counsel added that, in 2013, the Irish companies had successfully exited examinership, after a scheme of arrangement was approved with its creditors, and was approved by the High Court.
Commercial court proceedings
Counsel said that another issue was that, in 2019, the company’s UK parent had entered into a Company Voluntary Arrangement, which had resulted in landlords of two of its Irish stores taking commercial court proceedings against it. Judgment in those actions, counsel said, was pending.
These difficulties have had the effect of rending the companies insolvent, with predicted liabilities over assets of more than €1.8 million for the year ending August 2020, and were unable to pay their debts as they fell due.
The Irish firms had “no alternative other than to bring petitions seeking winding up orders”, counsel said. Counsel said the appointment of a provisional liquidator was in the best interests of all the relevant parties.
The liquidator would be able to engage with the firm’s employees, landlords, creditors and would also be able to deal with the company’s stock. It s creditors include its landlords and the Revenue Commissioners.
Mr Justice Quinn said he was satisfied to appoint experienced insolvency practitioner Jim Luby of McStay Luby as provisional liquidator to the companies. She adjourned the matter to a date next month.
