Michelle Mulherin (Mayo, Fine Gael)
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Elverys Sports is a company that has been trading profitably, notwithstanding its being taken into the National Asset Management Agency, an achievement that is due to the hard work of management and staff over the years. It has grown from a single shop in Castlebar, County Mayo, to a chain of 54 stores nationwide, with a growing online business. As a result of NAMA's shenanigans in handling the sale of the business, however, this profitable company has gone into examinership.

Is this how NAMA, the largest property company in the world, should be doing its business on behalf of the taxpayers of this country? As we know, NAMA issued a notice of decision to sell the company to a management buy-out team. Way past the 11th hour, however, it allowed that deal to be scuppered by entertaining a further bid, which resulted in the company being placed in examinership. What is the final cost of this examinership, not to mention the associated costs? Elverys Sports has been put into freefall on account of this uncertainty, which has adversely affected its ability to trade and will surely undermine the value of the company when it does comes to sale. It is enough to make one's blood boil when one considers the number of jobs at stake. Certainly, it seems clear that job protection is not a significant concern for NAMA in this particular instance. I am disappointed that the Minister for Finance is not in the Chamber this evening, given his responsibility for NAMA and its activities.

We are here today to press the case for safeguarding the 700 jobs that are at risk at Elverys Sports stores nationwide. The best way forward is clearly for a management buy-out to proceed. These people know best how the company works and have the wherewithal to forge ahead and ensure its growth as a leading Irish company. Every other day, I hear the Minister, Deputy Richard Bruton, his Cabinet colleagues, IDA Ireland and other Government agencies reminding us how difficult it is to get jobs into the west. Job creation is mainly taking place in the major centres of population, a fact that is recognised in the new regional focus included in the revised Action Plan for Jobs. What is the action plan to retain the nearly 200 jobs in Mayo that are in jeopardy? How is real meaning being given in this instance to the high priority NAMA is supposed to place on the preservation of jobs? Will the Minister offer some reassurance to the workers who are in the Chamber today and their fellow workers throughout the country?

Barry Cowen (Laois-Offaly, Fianna Fail)
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This is a very serious matter for the 700 employees of Elverys Sports, their families and the communities in which they reside. The company's staff are local to its units throughout the country and the various stores are dedicated to and embedded in their communities, as witnessed by the sponsorship they offer to various clubs and organisations and their support for students in offering them summer and weekend work.

As Deputy Mulherin outlined, Elverys Sports finds itself in examinership after a management buy-out was deemed not to be successful because there were other parties seeking to enter the fray. The examiner has an obligation to act in the interests of NAMA, as has been explained. However, NAMA, too, has an obligation to act in the interest of taxpayers. We in this House have our own obligations to the people who give us the privilege to be here. We also have an obligation to taxpayers to ensure that the funds provided to bodies like NAMA yield a dividend for the Exchequer. Any successful bid out of the six that are supposedly on the table must have at its core a commitment to staff interests. The best way to ensure that outcome is for the examiner to allow a staff representative to be privy to the assessment of the various bids. It is the responsibility of Government to ensure NAMA is cognisant of its social obligations as well as its economic responsibilities. It is also the responsibility of Government to ensure that debt not necessarily associated with a profitable business such as this is not allowed to drown jobs, communities and the retail sector, and thereby rid our towns of much-needed investment.

This particular case is a test of the recent comments by Morgan Kelly in his analysis of the economy. It is time for the Government to show it will not stand idly and allow this or any other SME of its type be put to the sword by those who would seek to strangle it in the manner in which matters have been pursued in this instance.

Joan Collins (Dublin South Central, People Before Profit Alliance)
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I received an e-mail last week from some of the Elverys Sports workers, as I assume did other Members. I was aware of reports in recent weeks that the company was going into examinership, with the likely outcome being a management buy-out. The general view among workers is that such an outcome would be best for them in terms of contracts, wages and conditions. In that context, it is absolutely amazing that we have arrived at a situation where the examiner has let other potential buyers into the fray.

Will the Minister explain why this has happened and what is likely to happen next? Will he give an assurance that whatever the outcome, the 700 jobs in Elverys Sports stores throughout the country will be protected, together with the contracts and conditions of the workers? This is a long-established company which, as the other speakers mentioned, provides sponsorship for sporting organisations throughout the country. Indeed, it is a much better sponsor than the cigarette and alcohol companies. We should support these types of local businesses as much as possible. I am not sure whether it is in the Minister's power to intervene with NAMA and with the examinership process. In any event, he has an opportunity this evening to explain to the workers what is happening.

Richard Bruton (Dublin North Central, Fine Gael)
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I thank the Deputies for raising this issue. As Minister with responsibility for employment, I am always concerned about any job losses. Indeed, job retention and creation has been my main focus since taking office.

The company referred to by the Deputies is in the middle of the examinership process and, as such, it is important that nothing be said here this evening that might affect the outcome of that process. It will be for the examiner to consult with creditors, potential investors and other relevant parties to devise the most appropriate course of action in the interests of the survival of the company and put that course of action to the court for approval. The court will have the final say and, until then, the company is under its protection. We must be careful to respect that.

Examinership is the main debt restructuring system for companies in Ireland and has been in existence since 1990. It allows for the rescue of companies which find themselves insolvent but have the potential to return to financial viability and continue in operation into the future. The key feature of the process is a period of court protection lasting up to 100 days during which nobody may institute proceedings against the company or petition for it to be wound up. The examiner uses this time to devise a scheme of arrangement in consultation with creditors, company management, potential investors and any other parties that will be affected by the scheme. The scheme of arrangement is put to the court and if the majority of the company's creditors and the court approves, it becomes binding on all of them.

In the case of Elverys Sports, I am informed that NAMA, in its role as a secured lender, approved the sale of assets of the parent company, Staunton Sports, to the management team following a process run by the directors of Staunton Sports through IBI Corporate Finance, acting under the duty of care to NAMA. However, the receivership event required to give effect to the transaction could not proceed at the agreed time because the management team did not have the requisite funding in place to complete. A higher bid was indicated by another party prior to the receiver's appointment and sale completion. The perspective receiver advised that, if appointed, he would be legally obliged to consider this bid, since he has a statutory obligation to secure the best price reasonably obtainable for the secured assets at the time of their sale.

Several press outlets have carried news of the third-party bid. The resulting uncertainty caused concern among suppliers and trade creditors, a situation which the directors of Staunton Sports brought to the attention of NAMA. Having regard to the deteriorating condition of the business and the company's insolvent position, and based on legal advice, NAMA put to the directors of Staunton Sports that examinership was an alternative option which would permit all bids to be considered while the company was under the protection of the High Court. It is on the public record that the appointment of an examiner to Elverys Sports was supported by the directors of the company. The decision to seek the protection of the court through examinership was taken in order to protect the company and its employees, and NAMA is funding the company during the examinership process.

It is understood that the examiner is currently in the process of engaging with various parties who have expressed an interest in the business, including the management team. As part of this process, the examiner has requested proposals from each of the parties regarding their plans for the business and for the employees of the company. The examiner has not yet concluded this process.

I believe examinership is a good option for companies that have real prospects for the future, but find themselves in financial difficulty at present. I should say that the examiner in this instance has already gone to the court and made a presentation to the effect that this company has a prospect of viability. He has convinced the court of the prospect of viability and the court has provided for a 100-day extension. That is an important first step that has to be taken. The company has done that. The balanced procedure that has to be followed in these cases takes account of the interests of the ailing company and the rights of its creditors and gives the courts a role in ensuring there is a fair and appropriate outcome.

Of course there have been some criticisms of the costs associated with the examinership process. For that reason, the Oireachtas passed the Companies (Miscellaneous Provisions) Bill 2013 late last year. This legislation allows small private companies to apply for examinership in the Circuit Court, rather than having to go directly to the High Court. I hope this will make examinership an option for more companies in the future. In the meantime, I am keeping the law on examinership under review. I am keen to identify whether there are other ways of making examinership less costly.

The specific issue of terms and conditions, which was raised by Deputy Joan Collins, is governed by the TUPE legislation. The TUPE obligations will apply in the event of the company being sold as a going concern. This means the current terms and conditions will continue to apply when the new owner is in place. I think I have responded to the other issues that were raised by Deputies.

John Lyons (Dublin North West, Labour)
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I am conscious that a written copy of the Minister's response was not made available in the Chamber. I ask the Minister to ensure his response is e-mailed to the Deputies at some stage.

Richard Bruton (Dublin North Central, Fine Gael)
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I will.

John Lyons (Dublin North West, Labour)
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I am sure it was not the Minister's fault.

Michelle Mulherin (Mayo, Fine Gael)
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I understand the nature of examinership. With all due respect, NAMA took on a healthy and profitable company. The company got into the difficulties that required it to go into examinership on NAMA's watch. I think questions need to be asked about the way NAMA is doing its business. Companies that do not have problems are encountering problems when they come under the NAMA umbrella. That is the taxpayer's concern. These employees are concerned about their jobs. The Minister did not mention their jobs. I asked the Minister for Finance about the level of priority that NAMA gives to the retention of jobs when businesses are being sold as going concerns. He assured me in his response that NAMA gives a high priority to the preservation of jobs in any business that has a loan with the agency. There is no evidence of that here.

It is crucial that the management buy-out should proceed. The company would not have gone into freefall if the notice of decision that was issued had been proceeded with at the time. Much of the blame for the fact that it has gone into freefall lies with NAMA. I believe it should be challenged. I am taking this up with the Minister for Finance. The Minister, Deputy Bruton, is responsible for the issue of jobs. I understand he is working night and day to try to create jobs. In this instance, jobs are under threat in the west, where jobs are hard to come by. We need more action. The reality of the promise set out in the response I received from the Minister for Finance needs to come into play to protect the jobs of the Elverys Sports employees.

Barry Cowen (Laois-Offaly, Fianna Fail)
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I thank the Minister for his response. He said that the examiner is obliged to consult the relevant parties that are privy to this process. Does he agree that the level of consultation with the workers in this case has been minimal? Subsequently, and on foot of what has been said to Deputy Mulherin, does he believe and will he acknowledge to us that NAMA has a social obligation and responsibility to seek to pursue the retention of as many jobs as possible? Does he think NAMA is doing that in the proper fashion in this instance? He acknowledged that the directors agreed with NAMA's recommendation that the company should enter this process. Can he go a step further, following on from what he said about TUPE, and make it clear that the representatives and the staff should have a better engagement with and involvement in assessing the bids that will ultimately determine their future? Progress should be made in a way that meets the responsibilities to creditors and leads to a settlement with which they can be happy.

If NAMA is the lead creditor, it must be obliged to respect the mandate it has from this House. In other words, NAMA has a social responsibility as well as an economic responsibility. Will the Minister reiterate for the House that these responsibilities must be applied in this instance to the full letter of the law? This is necessary if staff are to be sure that every effort is being made to give them the best possible opportunity to retain their jobs. As has been said previously, this company is in a profitable situation and cannot be allowed to be drowned as a result of being dragged down by loans that are not specifically related to the business. As I said earlier, this is the first indication the Minister can give on behalf of the Government that he will not stand idly in this instance or any future instances that relate to how banks deal with debt associated with small and medium-sized enterprises.

Joan Collins (Dublin South Central, People Before Profit Alliance)
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It seems that a profitable company, with the backing of its directors, went to NAMA to discuss a management buy-out. It appears that as a result of difficulties experienced after that time, it was not possible for the company to exercise that buy-out. There is something wrong with that process, to my mind. Why would a profitable company not be able to complete such a buy-out? I want clarification in that regard. I asked about what will happen to the contracts, conditions and pay relating to these jobs, in the event of the company being bought, because I understand that the TUPE regime should protect these workers and their jobs regardless of who buys the company. It seems strange that a process which was started on foot of a positive development has led to the company now being in difficulty, and possibly being bought by somebody else.

Richard Bruton (Dublin North Central, Fine Gael)
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To be fair to NAMA, there is a bit of a misunderstanding of its role. NAMA was supportive of an arrangement that would have facilitated a management buy-out of a company that was insolvent. Implicit in that was an agreement to have some of the debts dealt with to allow the company to continue to proceed. As I understand it, it was not NAMA's fault that it was not possible for this process to be completed. After an alternative bid came in, NAMA suggested that the best way to protect the company was to seek an examinership process, which allows for a write-down of debt where creditors agree - this answers Deputy Cowen's point - and involves court protection to save the jobs, save the enterprise and try to maintain a going concern. NAMA's role in this process led to the testing of one option, which did not fulfil what was required. Now it has taken another approach as part of the search for a viable outcome. I certainly hope such an outcome can emerge from this approach. It is clear, in response to Deputy Cowen's point, that this process allows viable businesses to survive without their existence being threatened by bad property decisions or property debts that might be burdening them. That is what this process is about. The courts have a role. The purpose of examinership is to save the jobs. The TUPE regime will apply regardless of whether there is a management buy-out or one of the other bids is successful and the business continues. The transfer of obligations undertakings will apply in both cases. The legal security of the workers will be the same in both cases. I acknowledge the point that there might be a preference for one or the other.

Reference was made to the examiner's role with regard to different players, including the creditors or the workers. Examiners are governed by very strict legislation that sets out what they can and cannot do. Essentially, they must try to find a scheme or arrangement that can be put to the creditors and allows for a viable outcome. I am sure they try to keep workers involved to the best extent possible during that process.

They have a responsibility to the courts and the creditors. In this case there are six bids which, no doubt, have to be dealt with as six independent bids and handled confidentially. I imagine the examiner is under considerable legal constraint in the way he deals with this situation. This is the best way in which we can seek to save the jobs involved, which I sincerely hope is the outcome of this process. The examiner was appointed on 4 February and is still at a relatively early stage in the process. I do not have a role in the examinership. Obviously, the examiner must deal with those directly involved and report back to the court, with the outcome of the various options.