Maltese firm can join in action on IL&P revamp
Published 09/08/2011 | 05:00
THE Maltese company leading the charge for small shareholders against Irish Life & Permanent's (IL&P) nationalisation was yesterday granted permission to join a legal action against the bancassurer's forced recapitalisation.
A High Court judge gave Scotchstone Capital permission to join a legal challenge that two other IL&P shareholders -- Gerald Nigel Bunting and Horizon Growth Fund NV -- mounted last week.
Scotchstone's chief executive Piotr Skoczylas said last night he had "no comment" to make on whether his company was joining the challenge in its own right or on behalf of the wider shareholder group.
Mr Skoczylas has been a leading figure in the battle against the bancassurer's €4bn recapitalisation, and was nominated to the IL&P board at a recent extraordinary general meeting.
In an email sent to IL&P shareholders the day Mr Bunting and Horizon filed their challenge, Mr Skoczylas said it "may be possible to add plaintiffs" to the action "at a later stage".
The Scotchstone boss also pointed out that it had been made "extremely difficult" for many shareholders to "defend their basic ownership rights and formally oppose" IL&P's recapitalisation because of the "very high legal/expert costs of the proceedings".
The legal action is trying to overturn a court order obtained by the Finance Minister on July 26 allowing the State to inject €2.7bn into IL&P, an investment that left shareholders with less than 1pc of the PLC.
In granting the application for Scotchstone to be joined, Mr Justice Sean Ryan told Mr Skoczylas that the minister may object to the company being involved in the challenge.
Under the Credit Institutions (Stabilisation) Act 2010, parties such as shareholders of the bank are required to serve notice of any legal challenge within five working days of the making of the recapitalisation order.
In their action, Mr Bunting and Horizon allege that the minister's actions were unreasonable and unlawful. In separate challenges, both claim their shareholdings in IL&P have been overwhelmingly diluted and their rights "have been abrogated without any consultation".
Both claim that the minister's decision to obtain the recapitalisation order was in clear disregard of the majority of the company's members.
It was further claimed that the stress tests on capitalisation requirements were unduly pessimistic and that the dilution of the shareholders' holdings in favour of the State was disproportionate.
Horizon Growth Fund BV, which has a registered address at Berg Arrarat on the Caribbean Island of Curacao, said that the company held more than 6,000,000 shares in IL&P, which it acquired between February and July 2011.
Mr Bunting, of Shelly, Suffolk, Ipswich, England, stated that he and his family owned a total of 3,030,000 shares in IL&P, which were held in a number of different accounts.
Mr Bunting and Horizon's actions have been adjourned to a date in September, for mention only. It was hoped that the full hearing of their challenges would be heard some time in October when the new legal term starts.