The High Court has appointed joint provisional liquidators to an Irish-based firm that is part of a group of companies that provides mechanical and electrical services to power generating wind turbines manufacturers.

The appointments were made in respect of Windhoist Ireland Limited, which had been working on a windfarm project, currently under construction at Ardderroo, near Moycullen in Co Galway.

The firm has 17 employees in Ireland.

The court heard that the wind-up order was being sought because the company's Scottish-based parent Windhoist, which is part of Windlogix Group, was entering administration in that jurisdiction and it could no longer provide funds for the Irish entity.

This meant that the Irish entity, and other firms within the group, lack sufficient cash to pay the employees in Ireland and in the other locations, the court also heard.

Companies within the group had been working on several projects, in locations including Finland and Taiwan as well as Galway.

However, it claims that the contracts had become unprofitable.

This was due to factors including the higher-than-expected operating costs, and the withholding of moneys due under the contracts by customers due to factors such as weather-related delays.

The parent company also owns and provided a significant amount of plant and machinery, including cranes to the Irish entity so it could carry it out its work.

Arising out of the parent's decision to enter administration that plant would no longer be available to the Irish company, the court heard.

While the Galway project was not specifically loss making, the lack of funds from the parent or the ability to use the machinery owned by the parent, meant that the Irish firm is now insolvent and cannot continue to perform its contractual obligations.

At the High Court Mr Justice Brian O'Moore said that he was satisfied to appoint Nicholas O'Dwyer of Grant Thornton Ireland and Stuart Preston of Grant Thornton UK as joint provisional liquidators to the company.

The company he said was insolvent and unable to pay its debts as they fall due.

The company, represented by Niall Buckley Bl, petitioned the High Court for the appointments on the grounds that it was the only alternative open to the company, given its financial dependence on the parent company.

It is anticipated that all of the contracts which it had been working will come to an end and most if not all of the company's employees will be made redundant.

Following the parent firm's decision to enter administration steps will be needed to secure the group's assets in different jurisdictions its subsidiaries have been operating in.

The Irish company's current creditors include its own shareholder which is owed €7m by way of intracompany loans, Revenue, which is owed over €600,000 and trade creditors who are owed €139,000.

Given the close relationship between the Irish company and its Scottish-based parent it was in the best interests of all the parties that joint provisional liquidators, who are based in the two locations, are put in place to help ensure that there was an orderly winding up of the business, counsel said.

The matter will return before the court in December.