Monday 27 March 2017

Ireland's No2 richest man seeks €2.5bn of Anglo debt

Sale of wealth management arm of busted bank delayed by board

Nick Webb

Nick Webb

LONE Star, the Texas-based private equity giant run by billionaire Irish passport holder John Grayken, is understood to have made a move to buy €2.5bn-worth of loans from Anglo Irish Bank as part of a massive deal for the bank's wealth management division.



Grayken was ranked as the second wealthiest Irish man in the 2011 Sunday Independent Rich List, with a fortune of €3.67bn.

His private equity group has more than €25bn in funds under management and specialises in capitalising on distressed debt.

However, sources close to the deal told the Sunday Independent that the long-running sale process for the Anglo wealth management arm was shelved last week as Anglo's board deferred a decision on the disposal.

"There was a board meeting on Thursday and the board unanimously approved the strategy and direction put forward by management," said a spokeswoman for the Irish Bank Resolution Corporation (IBRC) -- the new name for Anglo Irish Bank.

"It is not appropriate for the bank to issue any comment at this time due to commercial sensitivities. The bank will comment at the appropriate point in the near future."

It is thought that Grayken and other executives from Lone Star flew into Dublin recently to meet with bank officials.

Late last year, Lone Star agreed to buy close to €5bn- worth of loans related to Anglo Irish Bank's business in the United States. The deal closed recently.

Lone Star was involved in pitching for the loans and wealth management business with US real estate group GI Partners and Irish partners. It is thought that Key Capital and Deutsche Bank are also involved, with Prescient and a Davy-advised group also monitoring proceedings. US hedge fund Fortress has also been linked with the deal.

Sources close to IBRC have indicated that a decision has yet to be made on the future of the unit.

The sale of the wealth management business has been an extraordinarily convoluted affair caused by the complexity of the legal structures around the business, which was used as a vehicle for €2.5bn-worth of property syndicates.

Sources have indicated that Anglo may now be considering an alternative strategy for the business involving a wind down over a number of years.

However, it may not be able to offload the €2.5bn in loans without unpicking them from the wealth management business.

The Department of Finance did not comment.

Last year, the Sunday Independent revealed that another Lone Star player -- Ellis Short, the Irish passport holder who currently owns Sunderland Football Club -- had arranged to meet with key officials in the Department of the Taoiseach and Department of Finance.

Details of the meeting released under the Freedom of Information Act suggest that Short was keen to discuss a fund to recapitalise Irish banks.

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