Tuesday 26 September 2017

Application brought aimed at preventing sale of Government's shareholding in AIB

The State and AIB want the High Court to strike out an application

The action has been brought by Vincent O'Donoghue (stock photo)
The action has been brought by Vincent O'Donoghue (stock photo)

Aodhan O'Faolain

The State and AIB want the High Court to strike out an application aimed at preventing the sale of the Government's shareholding in the bank.

The action has been brought by Vincent O'Donoghue , who describes himself as businessman with an address at Church Street, Dublin.

As part of his proceedings against AIB Plc, the Minister for Finance, Ireland and the Attorney General, he seeks an order preventing the Government from taking any steps to dispose all or any parts of the shareholding.

Mr O'Donoghue also seeks a declaration that the proposed sale is contrary to the common good and is unlawful.

In a sworn statement, he refers to AIB's "long and sorry history of catastrophic governance failures" which he says demonstrates the bank is "incapable of operating in a lawful, responsible and complaint manner."

Among the examples he cites are when the state had bail out AIB subsidiary ICI in the 1980's, rogue trader John Rusnak, DIRT tax evasion culminating with the 2009 €21.8bn bailout of AIB.

He claims that if returned to private ownership AIB will "only serve one master" and have the sole focus of "relentlessly pursuing profits" for mostly foreign shareholders.

Both bank and the State parties oppose the action.

They have separately brought applications seeking to have his entire proceedings struck out on grounds including the vexatious, frivolous and bound to fail.

The matter was briefly mentioned before the court on Wednesday when lawyers for the State and AIB asked Mr Justice Paul Gilligan to bring forward the hearing of the application for an injunction to Friday of this week.

Patrick McCann SC, for the Minister for Finance, said there was some urgency in the matter.

While no timetable or exact date to sell the shares has been set, preparations for an Initial Public Offering (IPO) on the Irish and London stock markets have been underway for some time. 

A possible narrow window, based on factors including stock market stability, when it is believed the State will obtain maximum value for the shares, had been identified for late May/early June, counsel added. 

The mere existence of injunction proceedings could have an adverse impact on and could damage potential investor confidence in any IPO, counsel said.

Representing himself Mr O'Donoghue objected to his case being brought forward.

He said a date had been fixed for the hearing of the injunction next Tuesday.

He disputed claims the matter was so urgent it needed to heard this week.

He said the court should take account of the fact that the Government's decision to sell shares had been defeated in a recent vote in the Dail, but that it planned to go ahead with the sale regardless.

He added the Government has also been disrespectful to the judiciary.

Mr Justice Gilligan acknowledged a lot of time and expense has gone into the preparation of the proposed sale, he would hear the case on Friday.

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