Saturday 27 May 2017

IL&P goes head to head with private equity to buy out EBS

Irish Life & Permanent, headed up by chairman Gillian Bowler, is vying with Dublin-based Cardinal. Photo: Collins Dublin
Irish Life & Permanent, headed up by chairman Gillian Bowler, is vying with Dublin-based Cardinal. Photo: Collins Dublin
Laura Noonan

Laura Noonan

THE private equity consortium that has vowed to 'cut a deal' with debt-ridden mortgage holders was yesterday unveiled as one of the final bidders for EBS, along with Irish Life & Permanent.

The announcement came a week after the Irish Independent revealed that IL&P and the Cardinal-capital led consortium had made the EBS short-list drawn up by the National Treasury Management Agency (NTMA).

Four groups had originally been bidding for EBS, with UK private equity giant Doughty Hanson and US group JC Flowers failing to make the NTMA cut.

Endorsed

Yesterday, the NTMA's selection was endorsed by Finance Minister Brian Lenihan, who said the EBS sale process had moved "to its final state" with the selection of the two groups.

"The two bidders will be asked to prepare final bids over the coming weeks," the Department of Finance said in a brief statement issued yesterday.

It is understood, however, that the EBS sales process could take until December to yield a final result, with some sources suggesting the date could get pushed out into 2011.

Dublin-based Cardinal, whose backers include US billionaire investor Wilbur Ross and the Carlyle Group, has promised to "forgive" some mortgage debt owed by hard-pressed EBS borrowers. The deal would come with a number of strict conditions, including a profit-split clause if any mortgage holders went on to sell their homes at a price above their mortgage debt.

The Cardinal Group is also known to have a €3bn war chest for other Irish acquisitions should the EBS deal go through.

A spokesman for the consortium last night declined to be drawn on the mortgage plans or Cardinal's future acquisitions.

"All we're saying is Cardinal is delighted to be through to the next round and if they're successful they'll be bringing foreign capital into the Irish banking market," he said.

IL&P also sees EBS as part of a wider plan and hopes to merge the building society with Permanent TSB, which it already owns. The bancassurer has mooted other acquisitions, including the deposit book of Irish Nationwide.

"We welcome the confirmation (that we're through) and look forward to engaging with the various parties over the coming weeks in terms of the last stages of the process," said a spokesman for IL&P.

Irish Independent

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