AN Invest NI-backed anaerobic digestion project in Co Donegal has secured permission to waive £37 million in loan repayments due to its funders in a major restructuring plan after recording a pre-tax loss of £23.6m in 2019.
The Glenmore plant was initially set up in 2016 to turn 25,000 tonnes of poultry litter from Northern Ireland each year into energy, supplying power to manufacturers including Bombardier and Montupet.
The cost of the project was met by a £9.3m loan from Invest NI and a £14m loan from private equity group SQN. The US owned finance company subsequently invested further funds.
But the biogas project has been beset by major problems. In January it emerged that the lead investors wanted to sell it off rather than support a turnaround plan.
The Sion Mills registered Glenmore Generation Limited (GGL), which is owned by Donegal businessman Karol McElhinney, is now undergoing a significant restructuring programme.
It’s understood as part of the restructuring, the company has entered into a new finance arrangement with well-known Fermanagh business figure Ernie Fisher.
The details emerged in a new set of company accounts signed off by Mr McElhinney on April 21 2021.
The accounts, which detail the year ending December 31 2019, state that the restructuring arrangement signed between the company and its funders will result in GGL being granted a waiver on £37m of obligations due.
The accounts detail £6.7m due by the end of 2020 and another £35.4m due between two and five years.
GGL said the restructuring plan will leave it with adequate resources to cover its obligations for at least another 12 months, but that its the ability to continue as a going concern will depend on sourcing additional funds to bring the plant up to full operating capacity.
The accounts reveal value of the Ballybofey plant and machinery was devalued by around £16m between the end of 2018 and 2019.
According to Companies House, a loan arrangement with Mr Fisher in the form of a chattel mortgage was signed on April 22.
The security offered for the finance includes biogas plant machinery in Dunmurry, Newtownards and Newtownabbey.
A well-known figure in Co Fermanagh, Mr Fisher reportedly shared in a £60m windfall with his late brother Bertie after selling their family-owned Derrylin engineering group to Severfield-Rowen in 2007.
Invest NI’s contribution to the Glenmore project is currently written into the accounts of the Department for the Economy (DfE) as an expected credit loss (ECL) of £10m.
It’s understood that the UK Treasury agreed to cover the £10m ECL as part of the January monitoring round.
DfE previously described ECL as an accounting adjustment, adding that the losses may not materialise.
