Tipperary Fresh Foods Ltd, Nenagh, was sold on Thursday for £1 million (€1.27 million) without the required consent of a semi-State company which provided almost £400,000 in funding to it, the High Court heard yesterday. Mr Michael Purtill, counsel for the Shannon Free Airport Development Company told the court that the sale of Tipperary Fresh Foods, which manufactures pizza toppings, had deliberately been kept secret from SFADCO. Judge Joseph Finnegan said he regarded documentation relating to the sale as indicating a dishonest frame of mind on the part of Joseph Coleman O'Connor, controller of the pizza company. He said he would deem the documentation as deceitful until it was otherwise explained and granted SFADCO a mareva injunction freezing £300,000 of the sale proceeds.

He was told no order was sought relating to a £100,000 SFADCO shareholding in the company which had ceased trading. Ms Martina Holohan, company solicitor for SFADCO, said the Co Clare semi-State body promoted industrial development and employment in the Mid West, providing grants for training, research and development and the purchase of sites. She told the court Tipperary Fresh Foods Ltd, (TFF) of Lisbunny Industrial Estate, Nenagh, was controlled by Joseph Coleman O'Connor, of Tyone, Nenagh, and manufactured pizza toppings. In 1995 and 1998 SFADCO paid the company grants totalling £282,850. Two years ago it had also entered a shareholders agreement with Joseph Coleman O'Connor, Joseph Patrick O'Connor, Laurence Shimmel and Edward Billington (Meats) Ltd under which it subscribed £100,000 in consideration of 7.5 per cent of the ordinary share capital of TFF.

Ms Holohan said that in return for grant aid TFF had to build up its workforce of 27 employees by December of this year and would not dispose of any grant-aided asset for eight years without consent of SFADCO. She said that in breach of conditions SFADCO could demand repayment of the grants and that under the shareholding transaction TFF had agreed to hold regular Board meetings at which SFADCO would be represented. Ms Holohan said she had been told the premises had been sold on Thursday for £1 million only 15 minutes after a scheduled and subsequently cancelled meeting between SFADCO and Joseph C. O'Connor. She told Judge Finnegan she learned of the sale only because of inquiries made by a solicitor on behalf of the purchaser. She had been told the AIB bank had been given formal instructions to wire the proceeds of sale to the bank account of TFF's solicitors.

She had also learned that the £1 million would be used to repay money advanced by members of the O'Connor family and apparently secured in breach of agreements on the assets of TFF. Ms Holohan said she believed it was not the defendant's intention to discharge its liabilities to SFADCO and she feared the £1 million would be dissipated. It appeared that by arranging a meeting with SFADCO representatives on the morning the sale was to close, TFF had deliberately sought to ensure SFADCO would be unaware of the sale closure. Mr Justice Finnegan granted Ms Holohan leave to notify TFF and its solicitors immediately by telephone of the making of the mareva order.