Siac may face examinership following Polish losses

Siac Construction is one of the best known of Ireland’s construction companies with high-profile projects such as the Aviva Stadium.

Siac Construction, one of Ireland’s largest construction groups, is expected to seek the protection of the courts this week, possibly as early as today, as losses in Poland threaten the 100-year-old business.

It is expected the application to the courts will be supported by the group’s main lenders, Bank of Ireland, KBC andBank of Scotland Ireland.

The Siac group has operations in Ireland, Britain, Belgium, Canada and Poland and has approximately 560 employees. Efforts to get a comment from the group last night were unsuccessful.

Examinership is a process whereby a company or group of companies can get protection from its creditors while it seeks to put in place a viable plan for a business in difficulties.

Last year, the group cancelled a €400 million road project in Poland because of a dispute it was having with a local authority there. At the time, Siac chief executive Finn Lyden said the Polish road system was “a total and absolute mess and we felt we were better off out of it”.

He said the company was going seek damages of €22 million and make a complaint to the European Commission.

Earlier this year the European Commission announced it was freezing hundreds of millions of euro in development aid for Poland, because of fears of corruption in road-building.

Siac also pulled out of Polish road-building projects last year citing delays and unexpected costs associated with the Polish roads authority, as did Irish firm Roadbridge.

Earlier this year, Siac reported profits of €5 million for 2012, with turnover having grown by 13 per cent to €230 million. In the period between 2008 and 2011, the proportion of the group’s activities outside Ireland grew to 60 per cent from 16 per cent.

Siac is one of the best known of Ireland’s construction companies with recent high profile projects including the Aviva Stadium, Jury’s Hotel in Cork and the M4/M6 motorway. There are a number of subsidiaries in Ireland and abroad.

The latest annual return for the group filed in the company’s office shows it is owned by 20 shareholders, the majority of whom are individuals.

On its website, Siac says it was founded in 1913 and that, through a programme of alliances with major international civil engineering contractors and specialist contractors, it is able to undertake multidisciplinary projects of scale and complexity.

Companies that have successfully gone through examinership in the High Court in the recent past include Eircomand Homebase.

The Government has recently given the green light for fast-track legislation to facilitate low-cost Circuit Court examinerships for small businesses.

The move could give thousands of heavily indebted, but otherwise viable, firms an avenue to cut their debts without the massive costs associated with a High Court process. Source: Irish Times.