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Irish Times
a day ago
- Business
- Irish Times
Israeli businessman buys Ukrainian property formerly owned by Seán Quinn
A shopping centre and an office development in Kyiv formerly owned by businessman Seán Quinn have been sold by the Irish Bank Resolution Corporation (IBRC) to an Israeli businessman with operations in Ukraine. The properties – the Leonardo business centre and the Ukraina shopping centre – were sold for a price between €40 million and €50 million, substantially below the €70 million to €80 million they were worth when the IBRC first got legal control over the assets, according to sources. The sale, to Ofer Kerzner's City Capital Group (CCG) group, comes 14 years after Mr Quinn's assets were seized by Anglo Irish Bank after a disastrous contracts for difference investment by him in the bank's shares. After Anglo was subsumed into the State-owned IBRC, the bank engaged in a hugely expensive multi-jurisdictional battle with Mr Quinn and his family to assert its control over an international property portfolio that included the Ukrainian assets. READ MORE The Quinns, using offshore companies and a series of court actions in jurisdictions around the world, sought to frustrate the bank, creating a situation that was estimated to have cost the State up to €170 million in legal fees, lost rental income, and other costs. During the battle, both Mr Quinn and Seán Quinn jnr were jailed for contempt of court. [ IBRC liquidators hand €360m over to State as wind-up nears end Opens in new window ] The IBRC's efforts to assert control over the assets at one stage involved a deal with a Russian financial conglomerate, the Alfa Group , owned by a number of Russian oligarchs. Eventually the battle between the Quinns and the IBRC was settled. However, by then the developing tensions with Russia had affected property prices in Ukraine . The deal with the Alfa Group was unwound and the properties continued to be managed on the IBRC's behalf after the 2022 Russian invasion of Ukraine . Mr Kerzner is an Israeli citizen who has been doing business since 1998 in Ukraine, where his City Capital Group has an extensive property portfolio. One source said the price paid by City Capital is a very good one from its point of view, but involves a substantial risk given the ongoing war with Russia.
Irish Independent
28-05-2025
- Business
- Irish Independent
Slieve Russell Hotel made loss prior to last year's sale but outlook is more positive
New accounts for Slieve Russell Hotel Property Ltd show the company recorded a pre-tax loss of €1.46m in the 12 months to the end of June 2024. The pre-tax loss of €1.46m followed a very modest pre-tax profit of €9,000 in fiscal 2023. The 2024 pre-tax loss arose from interest payments almost doubling last year, from €1.84m to €3.35m. The company recorded the pre-tax loss despite revenues rising by 7pc from €19.05m to €20.43m. The loss at the hotel firm came ahead of the reported €30m sale of the 224-bedroom hotel last October by CBRE on behalf of the liquidators of the Irish Bank Resolution Corporation, Kieran Wallace and Eamonn Richardson of Interpath Advisory. The new owner is Brady Hotels Ireland, run by an Australian-based developer from Co Cavan. At the time of the purchase, Tony Brady said the Slieve Russell would continue to be run by a local team. He pointed out that the resort employs hundreds of people locally, both full and part time, and 'is an important part of the community'. With the collapse of the Quinn empire, the IBRC, formerly Anglo Irish Bank, assumed control of the Slieve Russell hotel when a share receiver was appointed to the hotel firm in April 2011. The business recorded operating profits of €1.88m in the 12 months to the end of June last, with directors stating that improved trading figures are a direct result of the capital investment programme which commenced in 2022 and continued throughout last year. The directors state that 'additional costs were incurred during 2024 in preparing the underlying assets of the company for sale'. They state that 'the outlook for 2025 is positive, and trading in 2025 is expected to be in line with 2024'. The directors state that the company has experienced significant inflationary increases, particularly in relation to payroll related costs. Numbers employed last year decreased by one from 272 to 271 as staff costs rose from €8.3m to €9.1m. The loss also takes account of non-cash depreciation costs of €1.4m. Aggregate pay to key management last year decreased from €718,000 to €673,000. At the end of June last, the firm owed €68.2m to the IBRC and, subsequent to year end, the directors state that the loan liability owed by the company to IBRC was settled in full under the terms of a settlement deed and allowed the hotel sale to be concluded. Other hotels that were once in the Quinn empire have also been sold in the last year by the IBRC. Hotel Prague was bought by a Czech property holding company, and Buswells Hotel on Molesworth Street in Dublin has been purchased by Roundstone Real Estate.
Irish Times
21-05-2025
- Business
- Irish Times
Irish Nationwide manager shocked at Michael Fingleton's ‘get out of jail card' for borrower
A former senior commercial manager at failed lender Irish Nationwide has told the High Court he was left 'absolutely shocked' that Michael Fingleton Sr, referred to as 'the boss' at the bank, confirmed an alleged 'get out of jail card' to a borrower who could not repay a multimillion euro property loan. Conal Regan, who joined the bank after Mr Fingleton left the society in April 2009, told the High Court on Wednesday that the defendant allegedly wrote a letter to a lender, Louis Scully, who borrowed almost €6 million to purchase land in Co Meath in October 2007, confirming that the sum loaned to him was a 'non-recourse' one. A non-recourse loan means that debt on a loan is secured by the collateral and cannot be pursued by the lender from the borrower. The High Court civil case, which is in its third week, against the former INBS chief executive and managing director alleges he negligently mismanaged the building society and engaged in property 'gambles' with high-net-worth individuals in an informal and speculative manner in the mid-2000s, leading to fatal losses. READ MORE Mr Fingleton (87), who cannot give evidence due to ill-health, joined the building lender in 1971 and retired in 2009. He held the roles of both managing director and chief executive in that time. At its height in 2007, INBS had reported assets of €16 billion but was a high-profile casualty of the financial crisis in 2008. Liquidators for Irish Banking Resolution Corporation (IBRC) have taken the case against Mr Fingleton, who denies the allegation of negligent mismanagement. The total losses at INBS had been estimated to be €6 billion. However, only €290 million in damages is being pursued by IBRC, relating to five specific loans, allegedly approved by Mr Fingleton. The court has been told that Mr Fingleton was allegedly 'nodding through' top-ups and extensions to certain clients without the knowledge of the society's board. At the High Court on Wednesday, former INBS manager Mr Regan, who joined the society in late October 2009, said he was dealing with 'significantly' distressed credits at the lender. When Mr Regan queried and tested loans issued to Mr Scully, he was told by letter from Mr Scully that the money advanced to him were all 'non-recourse' loans. Lyndon MacCann SC, for IBRC's liquidators, was told by Mr Regan that a February 2009 letter from Mr Scully to Tom McMenamin, then manager of commercial lending at Nationwide, referred to a list of borrowings by Mr Scully and other individuals that stated 'nobody was getting any younger'. Mr McMenamin wrote back saying that all loans to Mr Scully were made on a non-recourse basis. Mr Regan said he could not find any reference 'anywhere' in the paperwork about a non-recourse element in a loan to Mr Scully for Meath lands – measured at 21,700 acres – at €598,7850, arising from a value of €275,000 per acre, which Mr Regan said 'seems exceptional, very, very high'. Mr Regan said he reacted by thinking 'why in the name of god was a get-out-of-jail card given here, given the level of funding that had been provided?' 'I just could not understand that somebody could possibly believe that letter would trump agreements or legal documents signed and on a 'normal-recourse' basis. All of a sudden there is this and it just didn't make sense,' Mr Regan told the court. Mr Regan said he had looked at the files regarding Mr Scully's loans and that 'non-recourse was mentioned nowhere. Nowhere'. Mr Regan told the court he asked Mr McMenamin 'why in the name of god' was the letter of confirmation issued and claimed Mr McMenamin told him: 'I was only doing what the boss told me to do'. Mr MacCann asked who was being referred to as 'the boss' to which Mr Regan said he was told by Mr McMenamin that this was a reference to Mr Fingleton Sr. Later in December Mr Scully wrote to Mr Regan saying as far as he was concerned all of his business with the society was on an non-recourse basis and that this had been agreed by Mr Fingleton. Mr Regan told Mr Justice Michael Quinn that it was a 'shocking assertion' and that 'individuals were not even putting hands in their pockets' if they had a 'free bet' on getting planning or zoning for lands. 'It was a get out of jail card. It was incredible. I have never, never come across it before,' said Mr Regan. In response to a request for any documentary evidence as to the agreement between Mr Scully and Mr Fingleton, Mr Scully wrote back on March 25th, 2010, enclosing a letter of confirmation of the non-recourse loans from Mr Fingleton and writes 'I trust this brings matters to a conclusion'. Mr Regan said he was left 'absolutely shocked' by the letter from Mr Fingleton. The case continues at the High Court.
BreakingNews.ie
20-05-2025
- Business
- BreakingNews.ie
Loans issued by Irish Nationwide in face of financial crash 'hard to justify'
Failed lender Irish Nationwide Building Society was operating akin to a merchant bank when taking "very strong lending positions on speculative proposals", a state-appointed director has told the High Court case against former bank chief Michael Fingleton Sr. State appointed chartered accountant Rory O'Ferrall on Tuesday told the High Court that a series of multi-million euro loans were "very unusual" in the face of an economic crash and were "hard to justify" given Mr Fingleton pledged in 2007 to the society's board that the lender should be "risk averse" in the face of the financial climate. Advertisement The civil case against the former INBS chief executive and managing director alleges that he negligently mismanaged the building society and engaged in property "gambles" with high-net-worth individuals in an informal and speculative manner in the mid-2000s, leading to fatal losses. Mr Fingleton (87), who cannot give evidence due to ill-health, joined the building lender in 1971 and retired in 2009 - he held the roles of both managing director and chief executive in that time. At its height in 2007, INBS had reported assets of €16 billion but was a high-profile casualty of the financial crisis of 2008. Liquidators for Irish Banking Resolution Corporation (IBRC) have taken the case against Mr Fingleton, who denies the allegation of negligent mismanagement. The total losses at INBS had been estimated to be €6 billion. However, only €290 million in damages is being pursued by IBRC, relating to five specific loans, allegedly approved by Mr Fingleton. Advertisement The court has been told that Mr Fingleton was allegedly 'nodding through' top-ups and extensions to certain clients without the knowledge of the society's board. Today at the High Court, Mr O'Ferrall likened the lending of the society to that of a "merchant" bank which, he said, takes higher risks in lending but takes a share of the proposed profit from loans made on projects. He said this criteria of operating requires a different set of skills and expertise in specific industries and areas of the globe in fields such as shipping, railways, property and development. Mr O'Ferrall said Irish Nationwide under Mr Fingleton had taken up "very strong lending positions" in property development on speculative proposals in the UK and France. Advertisement Mr O'Ferrall said that at around the time of loans issued between 2006 and 2009, there was a "generally held view by investors and banking" by 2007 that there was going to be a property market downturn and that by 2008, "all banks" were experiencing the predicted difficulties. Mr O'Ferrall told Lyndon MacCann SC, for IBRC's liquidators, that INBS no longer held a banking licence, was therefore not trading anymore and that its only activity was in resolving various claims, including some from abroad. Gerry McGinn, a former chief executive who arrived after the departure of Mr Fingleton, referenced a loan for a luxury hotel project in a skiing area in the south of France, referred to as 'Ice Mountain', which the borrower had valued at €32.85M with planning permission. However, the project had no planning permission and was then hit with a bill of €565K by French tax authorities. INBS paid the borrower, Cyril Dennis', tax bill when requested to "stay in the game" regarding the asset which was never developed. Advertisement When Nama bought the loan for Ice Mountain in 2010, it stood at around €31 million. Nama paid just under €11 million for the loan, resulting in a loss of €20 million for the tax-payer. Mr McGinn said that when INBS received a valuation "about a hotel in a foreign country, and just getting a number on a page... it is pretty meaningless". Mr McGinn said the interest of the society seemed to have been "secondary" to some of the relationships between Mr Fingleton and the borrower. Mr McGinn said there were a number of different risks in lending into a foreign jurisdiction. He said that the society may have felt that it was a "gun to your head situation" in paying the French tax bill upon Mr Dennis' request in order to avoid being "badly exposed". Advertisement It may, he said, have been a question of the society being stuck "between the devil and the deep blue sea". The case continues at the High Court. In opening the case earlier this month, Mr MacCann said Mr Fingelton "gambled" with the society's money when he allegedly approved "speculative, risky" commercial loans, which sometimes had already been greenlit by him before they were taken before the board of directors or the credit committee. The five loans allegedly approved by Mr Fingleton relate to property land development projects between 2006 and 2009 in the UK and France, despite them having no zoning or planning permission, counsel said. It is further alleged that there were no securities in place on the loans and no personal guarantee sought for or provided by the borrowers. Mr Fingleton was a prominent presence in Irish business during the Celtic Tiger and was reported to have been worth around €75 million in 2006. However, his son has told the courts that his father is reduced to €25,000 in two personal bank accounts and has outstanding judgment debts of more than €10.7 million.
BreakingNews.ie
13-05-2025
- Business
- BreakingNews.ie
Changes in claims against Michael Fingleton put his defence in an 'intolerable' position, High Court told
The High Court case against former Irish Nationwide chief Michael Fingleton Sr has heard that his legal team were put in an "intolerable" position by alleged changes in the approach and claims by the plaintiffs - the liquidators for IBRC - who are pursuing the now-incapacitated defendant for €290 million in damages. The civil case against the former Irish Nationwide Building Society (INBS) chief alleges that he negligently mismanaged the building society and engaged in property "gambles" with high-net-worth individuals in an informal and speculative manner in the mid-2000s, leading to fatal losses. Advertisement Mr Fingleton (87), who cannot give evidence due to ill-health, joined the building lender in 1971 and retired in 2009 - he held the roles of both managing director and chief executive in that time. At its height in 2007, INBS had reported assets of €16 billion but was a high-profile casualty of the financial crisis of 2008. Liquidators for Irish Banking Resolution Corporation (IBRC) have taken the case against Mr Fingleton, who denies the allegation of negligent mismanagement. The total losses at INBS had been estimated to be €6 billion. However, only €290 million in damages is being pursued by IBRC, relating to five specific loans, allegedly approved by Mr Fingleton. The court has been told that Mr Fingleton was allegedly 'nodding through' top-ups and extensions to certain clients without the knowledge of the society's board. Advertisement At the High Court on Tuesday, solicitor Niall Clerkin, for Mr Fingleton, said his client and their legal team were put in an "intolerable" situation due to amendments in the statement of claim against his client, and complained of missing documents and "very relevant" witnesses not being called by the plaintiffs. Mr Clerkin said the case was now on its fifth version of a statement of claim against his client. The solicitor also said that "generic" or "systemic" allegations in the action had been precluded from the case at a previous hearing of the Court of Appeal. However, Mr Clerkin said the plaintiffs were still characterising the alleged negligence in general terms and describing the five loans at issue as "emblematic" or a "manifestation" of broader alleged wrongdoing. Mr Clerkin said that the plaintiffs have said they will call two Central Bank witnesses, "who could only be giving precluded systemic evidence", and that they could "not possibly have evidence regarding the specific five loans". Advertisement The solicitor said the impression being given in the case against Mr Fingleton was that his client was "like a toxic agent" and that "all the problems that happened were because of him [Mr Fingleton]". Mr Clerkin said the defence sought "clarity" in what was alleged against his client, saying the allegations were "very confusing" to defend and "heightened the amount of prejudice that we face" in defending the case. Mr Clerkin said that the original claim against his client was for €6 billion, but now only five per cent of the original claim was being pursued. He said the other 95% of the claim has "fallen away in concession" and "substantial tracts" of documents were missing from the case. The solicitor said the defence tried to engage with an expert who said he "simply would not be satisfied he had enough information to provide a proper expert opinion". Advertisement Regarding the use of expert finance witnesses in the case, Mr Clerkin said: "We don't have a reliable file set available, so the methodological foundation is broken. It's corrupted from our standpoint." He added that expert witnesses are reliant on what is sent to them by legal practitioners. Business Disgraced former solicitor Michael Lynn fails to h... Read More Lyndon MacCann SC, for the plaintiffs, said any suggestion that documents were being withheld would be "scurrilous". Mr Clerkin responded that "massive tracts" of information were missing, that there was no allegation of bad faith towards the plaintiffs but that it was "nearly impossible" for an objective analysis of events due to missing documents. "I can't change the way the world is for him [Mr MacCann]," said Mr Clerkin. Mr MacCann said that it was the plaintiff's case that, through discovery, amendments were made to the statement of claim against Mr Fingleton. However, he said it was "always" the plaintiff's case that claims against the defendant could be expanded, but the five specific loans were to remain the "focus" in the case. The case continues at the High Court.
