Lynch Hotels gone into Examinership!!!!

asmobhosca

More Bad News for business in clare.........

http://www.rte.ie/business/2009/0723/lynch.html

Keano

'We have taken today's action to restructure our business and as a long-term step to ensure the future of the Lynch Hotel Group,' said Mr Lynch.

'We are confident that our forty years of experience in the hotel business, our customer and staff loyalty and recognised innovation practices will see the company through this process,' he added.

Not all doom and gloom

clarecoco

Lynch Hotels has voluntarily entered examinership. Under examinership legislation, the company has protection from its creditors – in this case 100 days - while it seeks to negotiate a settlement.

firesidechat

540 jobs are at stake here!
Plus local suppliers and service contractors. They are victims of their own success.The west county is like a ghost town for the last few years since the bypass opened.They can no longer rely on passing trade.The downturn in the airline industry has seen a drastic decrease in overnight stays for various airline cabin crews.The old reliable's are not there any more.Even though they offer quality food and accomadation they simply cannot draw in the clients.
The clare inn catered mostly to overnight bus and coach tours,which simply don't exist in these economic times.Plus it is carrying a large debt
from recent expansion.
They will find it extremely difficult to trade their way out of these circumstances.They have always been good local employers and all one can do is to wish them well.

Clareman

Again, owned by builders, I can't comment on whether the hotels were making a profit or not, but there seemed to be a wedding in either the West or the Clare Inn every weekend, I'd imagine that they have massive PR budgets as well as HUGE staffing costs, the amount of staff they have at every location was unbelivable

Run_to_da_hills

The car park was packed this evening at the West County, I would put the West County as one of their better earners. The Clare in would not be as busy because of its distance out of town and with the drop off in shannon air traffic. He also had several ongoing US contracts with Shannon stop overs. Both the Clare Inn and West County do well with wedding functions.

Micky Lynch also had his foot in the property market. It was quite often to see him show off his brand new top of the range plant outside his maintenance yard on the limerick Road roundabout. A lot of this equipment including teleporters, diggers, dumpers Jcbs etc would be now lying idle with repayments. I don't know how deep he got in this market which was also one of the downfalls of the Tom Hogan group.

He would also have repayments on some of his new chains added during the boom years including the head office at Vision House, with the competition that is out there his deals are currently rock bottom. I don't know how they can survive.
http://www.lynchotels.com/offers/

The Government did not help either with its E10.00 tourist tax introduced in the last budget.

Clareman

Mickey lost a lot when the new Tesco was blocked by the planning permission crowd. The West has to be a earner, everything seems to happen there, from election counts, to home comings, to concerts, by looking at some of their offers they can't have being making money out of it, they must have been relying on people buying "extras"

Run_to_da_hills

Clareman wrote: »

Mickey lost a lot when the new Tesco was blocked by the planning permission crowd. The West has to be a earner, everything seems to happen there, from election counts, to home comings, to concerts, by looking at some of their offers they can't have being making money out of it, they must have been relying on people buying "extras"

They also had the sports club which was a little sideline until the County pool took some of their business.

One of my fondest memories of the County was when Lisa Lashes booked a gig, When management took the order they thought they had booked a "country & western" singer. They got a shock when Goonie arrived with a 60KW PA system and had to move some of the residents over to the Clare In that night. Night went down well despite the floor being dotted with pills after the cops appeared.

drunken_munky52

Yorkie Lynch AKA Seamus (not his father Mickey that was above stated as the boss), too much wasteland purchased during boom times and still empty, like on the Limerick Road and Tobartasocan/AbbeyVille. Not worth squat for what was paid for it now.

It would appear that overpriced properties purchased is bringing down the curtain on other operations, more liabilities now than assets.

I know Yorkie will consolidate and make the hotels survive, he just has to wind up his building firm. I see the joinery on the Clare road is up for lease, nobody said anything about the job losses there!

BLITZ_Molloy

The Lyches never spent a penny more than they needed to on their hotels, and they were always packed out so I don't think that's where the problem is. I'd say it's entirely property speculation that has them in trouble.

Mikey has a mad work ethic but his son is lazy. The guy must be 20 stone.

Calvatron

I left the West County of my own volition just under a year ago and to be honest they we're probably relieved as it was one less job they had to cut. I know that before I left the place was a ghost town. We didn't have any residents and had just lost valuable contracts with air crews. The writing was on the wall then and at that it was probably still one of the busier hotels in the chain. They will consolidate and get back on track. However, they will have to downsize considerably. Fact is, no business can claim to be thriving in this climate. At least they are taking measures to ensure their survival.

straightanswers

BLITZ_Molloy wrote: »

The Lyches never spent a penny more than they needed to on their hotels, and they were always packed out so I don't think that's where the problem is. I'd say it's entirely property speculation that has them in trouble.

Mikey has a mad work ethic but his son is lazy. The guy must be 20 stone.

It is one thing to discuss a Clare business that is in trouble but why get personal about it - not really surprised it seems to be an Irish thing.:(

I , like other people,who know how valuable the Lynch Hotels are to the Clare Region, are really hoping the group can come through this.

drunken_munky52

The West County Hotel is a gold mine for them, so if it aint broken don't fix it. Why would they invest in doing it up, they didnt get rich by spending money.

Clareman

They aren't closed yet, they are just in voluntary receivership, they might pull through

OldGuysRule

The building contractors and the hotel business are separate businesses and run by two different brothers, Michael B runs the hotel business and Seamus runs the construction side. The father is known as Micky. drunken munky take note

Calvatron

drunken_munky52 wrote: »

Both are big into been general **** too, like father like son I suppose. Mickey B is the biggest lick arse I have ever known, time and time again throwing FF gatherings for nothin, the last time I saw Bertie leaving that shoe box of a hotel they call the West County, I thought there is def a link between the brothers in regards licking FF arse, for back door favours when it comes to getting big building contracts in Dublin.

Hahaha someone doesn't like the Lynch's. I think you have a point somewhere in there but as much as there may be some truth to what you say, you are only speculating. The West County has been holding FF conferences and meetings for 40 years. Last time I checked it was a person's choice to support whichever political party they wished. I'm sure there is other Hotelier's in the business who offer the same facilities to FG or the Labour party. To say that they scored building contracts in Dublin because of their allegiance to the FF party is probably true but isn't that the way big business is conducted these days? For the record I am a former employee of Lynch Hotel's but owe them nothing. In my 6 years with them they we're good employers and it is a shame that they find themselves in these difficulties.

asmobhosca

drunken_munky52 wrote: »

Yorkie Lynch AKA Seamus (not his father Mickey that was above stated as the boss), too much wasteland purchased during boom times and still empty, like on the Limerick Road and Tobartasocan/AbbeyVille. Not worth squat for what was paid for it now.

It would appear that overpriced properties purchased is bringing down the curtain on other operations, more liabilities now than assets.

I know Yorkie will consolidate and make the hotels survive, he just has to wind up his building firm. I see the joinery on the Clare road is up for lease, nobody said anything about the job losses there!

Drunken monkey you seriously havent a clue what youre talking about.
Michael Lynch Snr. started the hotel and the joinery/construction company in the 60's. After retiring one son took over the hotels and the other the construction company. Michael B runs the hotel group and Seamus (yorkie) runs the construction. They are completely separate companies.

As for the "wasteland" on the limerick road that surrounds the joinery site, most of that land has been owned by them for years and any bits they did buy down there were bought cheap.


Also you mentioned in another post about the construction company getting big jobs in dublin due to their F.F. connections..... I challenge you to name ONE construction job they completed in dublin besides the Green Isle hotel which they later sold....

It looks like this country is headed back to the 1980's economically and our attitudes towards anyone who sticks their neck out in business is heading back to the same begrudgery bull**** that I thought we had left behind.

This country really is ****ed in so many ways...

Saying that I for one hope the lynch's can pull through it and emerge from examinership, the mid west needs them to.

drunken_munky52

OK, I cant name a job in Dublin other than that one.

But I will never feel sorry for Yorkie after he built that monstrosity of a house near the showgrounds. It looks like something from Istanbul for god sake, and he did it without planning premission and got a retention order after it went up. Cute whore he is, very pompus.

Kradock

Lynch hotels are in examinerhip purely because they want to thin thier work force and force reduced pay and terms on their remaining employees.

It isn't too long ago that they hired a new executive manager and within a week were telling the employees that they will have to take a 10% paycut.

Maybe the hotels and the construction business are separate entities but I would guess that the assets and finances are linked somewhere along the line.

I look forward to the examiners report as this is definately a going concern that will survive but again another example of business people exploiting the opportuinities that are being given to them by the recession. It is the employees who will suffer at the hands of the oppurtuinsts.

palaver

I am wondering: What exactly means an examinership? It isn't exactly bancruptcy or insolvency? Or is it?

As far as I know it just means that insolvency looms but that there is still a ray of hope that the examinership people would find a solution to avoid the closing down of the business - as it happened with Hogan's.

Can anyone enlighten me, please? About the term examinership?

Run_to_da_hills

palaver wrote: »

I am wondering: What exactly means an examinership? It isn't exactly bancruptcy or insolvency? Or is it?

As far as I know it just means that insolvency looms but that there is still a ray of hope that the examinership people would find a solution to avoid the closing down of the business - as it happened with Hogan's.

Can anyone enlighten me, please? About the term examinership?

In a nutshell it means "Get your act together" Linches Hotel group owe money left right & center to various creditors, The group have bought time to try to try to reorganize the running of the business possibly with crows flying from the chimneys, expect lay offs, properties that aren't earning sold off etc.

I could see "Vision House" which was formally a large B&B on the Limerick Road being sold off and their books moving back into a more dignified location. Usually when a company is in examinership a third party is called in to try to sort it out and get it back on its feet again.

I personally would not like to see this group in trouble.

palaver

Run_to_da_hills wrote: »

In a nutshell it means "Get your act together"
...
Usually when a company is in examinership a third party is called in to try to sort it out and get it back on its feet again.
.

Thanks. That's what I thought.

A friend told me it's the same as a liquidator. Which I doubted.

Run_to_da_hills

palaver wrote: »

Thanks. That's what I thought.

A friend told me it's the same as a liquidator. Which I doubted.

If they were were "gone" town would know about it, the shuttering ply would be up and the place would be empty just like the Tom Hogan group :mad:

Dr Kamikazi

firesidechat wrote: »

540 jobs are at stake here!
Plus local suppliers and service contractors. They are victims of their own success.The west county is like a ghost town for the last few years since the bypass opened.They can no longer rely on passing trade.The downturn in the airline industry has seen a drastic decrease in overnight stays for various airline cabin crews.The old reliable's are not there any more.Even though they offer quality food and accomadation they simply cannot draw in the clients.
The clare inn catered mostly to overnight bus and coach tours,which simply don't exist in these economic times.Plus it is carrying a large debt
from recent expansion.
They will find it extremely difficult to trade their way out of these circumstances.They have always been good local employers and all one can do is to wish them well.

The bypass can't be entirely blamed.
If people still want to come to Ennis, they will.
But Shannon airport is promoted as the gateway to the west, but despite being in Clare, the county isn't even mentioned.
Shannon airport itself has a sniffy attitude to Ryanair, they want to go back to the "good old days" of Aer Lingus and enforced stopovers.
The West County hasn't changed since the 80's and the menu is mediocre Oirish at best.
There is an airport spewing thousands of tourists into the area, but there's no plan, no strategy and why on earth isn't there a rail link?
A 6 year old child could tell you that Limerick, Shannon, Ennis and Galway should be linked by rail.
Sadly the area seems to be run by people who are not as smart as a 6 year old.
Tourism is not a given, we can't just sit back, relax and expect tourists to turn up and cough up big time for hotels that are just about alright and food that just isn't.
The one person who has done more for tourism here is Michael O'Leary and this wonderful resource has been ignored and neglected.
We should be PAYING people to come here, rather than just thinking how we can make more money out of them.
The castles are WAY overpriced, don't get me started on various ferries, food, pubs, most people go away here thinking that they've been just a little bit robbed.
The goose is cooked and only a radical rethink and restructure will get us out of this.

alphamale 1

Is Breaffy House in Castlebar also in this group?? Saw them doing a big push on weddings lately. Personally, would be fav venue as problems with food and parts of hotel are old and bit outdated and unreliable> Big risk for the employees though:)

asmobhosca

palaver wrote: »

I am wondering: What exactly means an examinership? It isn't exactly bancruptcy or insolvency? Or is it?

As far as I know it just means that insolvency looms but that there is still a ray of hope that the examinership people would find a solution to avoid the closing down of the business - as it happened with Hogan's.

Can anyone enlighten me, please? About the term examinership?

http://www.mop.ie/dynamic/files/Insolvency%20Group%20Examinership%20preserving%20the%20core%20value%20of%20a%20business%20JMOC%20Finance.com%20Online%20March%202008.pdf


The Examinership procedure was introduced by the Companies (Amendment) Acts 1990 and 1999 to provide a mechanism for the rescue and return to health of ailing, but potentially viable, companies. Examinership allows a company a period of protection from its creditors, within which time the company and the examiner endeavour to find parties to put together a survival plan usually entailing fresh investment and the writing down of creditors’ claims. Although there are a number of differences, this process is similar in many respects to Chapter 11 in the US and, to a lesser extent, administration in the UK.

During the protection period, although management stays in control of the company, the court appointed examiner is obliged to examine the financial situation of the company and endeavour to put together a package or scheme of arrangement which will be acceptable to the creditors, and to the court. If the scheme of arrangement is approved by the court, it becomes binding on all parties, even though not every class of creditor may have agreed to the proposals at the meetings of classes of creditors which the examiner is obliged to convene.
The examiner's proposals usually entail fresh investment in the company, writing down creditors’ debt and sometimes changes to the company’s management structure. To approve the scheme, the court must be satisfied that the creditors will not fare worse under the proposed scheme than they would in a liquidation of the company.In order to succeed, firstly the company must have an underlying successful business and secondly, the examinership normally takes the full 100 day protection period allowed by the legislation, and in order to work, the company must be able to fund itself for that period (including paying suppliers, taxes, etc.).


Having the pressure from creditors eased can allow a company the room to restructure, to renegotiate and to re-energise itself to such a point that it can stand on its own two feet again and continue trading. Over 80 per cent of Irish companies which enter the process end up doing just that. Of course, in order to be successful, the scheme of arrangement must have the support of a majority of at least one class of the company’s creditors to accept less than their full debt. However, given that the alternative is liquidation, in which case creditors will usually get less than they would under the proposed scheme, it is usually possible to obtain the requisite support. In addition, they can usually be paid more promptly than they would do in a liquidation, while still retaining a valuable trading partner.


An unsuccessful examinership will almost invariably end in liquidation. Whilst liquidation may be the end point, examinership has in the past represented an 80 per cent chance of staving off that particular eventuality.