Decide the best option for your company
Where a company is struggling with excessive debt, but has a solid underlying business, examinership should be considered. Examinership gives companies breathing space to find fresh investment and put a proposal to its creditors. At Deloitte Ireland our examinership experts can help you to decide the best option for your company.
- What is an Examinership?
- Who should consider an Examinership?
- How an Examinership can work
- Advantages of an Examinership?
- How can we help?
What is an Examinership?
Examinership is a process used by a company in financial difficulty to reach a binding agreement with its creditors to pay back all, or part, of its debts over an agreed timeline.
The process is overseen by the Circuit or High Court, who provide the company with protection from its creditors during the examinership period. This protection gives the company breathing space to find fresh investment.
The new Companies Act has made Examinerships significantly cheaper and more flexible, with the result that they are now a realistic option for struggling SMEs to consider.
Who should consider them?
- Companies that are insolvent with large debts
- Companies needing to restructure
- Companies experiencing trading difficulties
- Companies under pressure from their creditors
- Companies wanting to avoid liquidation
How an Examinership can work
- The company applies to court for protection from its creditors and the appointment of an Examiner
- The Examiner draws up proposals to put to the company’s creditors in the form of a Scheme of Arrangement
- The company sends out the Scheme to its creditors, together with notice of a creditors meeting
- Meeting held where the Examiner explains the proposals in the Scheme
- Creditors vote in favour of scheme
- Court approves scheme
- Debts written down as per the scheme’s proposals
What are the advantages of an Examinership?
- Large write downs of debts can be achieved
- Leases can be re-negotiated/ disclaimed
- Company continues trading
- Directors stay in control of the company during the examinership
- Gives the company time to be restructured
- Avoids liquidation
- Protection from creditors – a receiver or liquidator cannot be appointed
- Lower costs if Circuit Court used
How can Deloitte help?
Our Examinership experts can guide you through every step of the process to ensure that the Examinership has the best possible chance of success and that the process goes quickly, smoothly and cost effectively.