McInerney MD in move to purchase Spanish operations
BARRY O'Connor, the managing director of home builder McInerney, is attempting to buy the group's Spanish operations as part of a restructuring review which is under way at the battered company.
Mr O'Connor has received permission from the McInerney board to be excused from his executive responsibilities in order to pursue the planned acquisition.
His duties are being assumed by the group's financial director, Enda Cunningham.
Last week, McInerney reported a loss of €25m before exceptional items for 2009, compounding a €47m loss recorded in 2008.
It has slashed the value of its Irish land bank in half and engaged investment bank Goldman Sachs to examine ways of raising fresh capital and restructuring the business.
Mr O'Connor is hoping to buy the Spanish unit as part of that restructuring process.
McInerney has had a presence in Spain since 1987 and operates there under the Alanda name.
The division primarily engages in sales, holiday rentals and resort management, at the Alanda Club resort in Marbella.
Management of the Alanda Club generated revenue of €3.1m in 2008 for McInerney, compared to almost €2.8m in 2007.
In the six months to the end of last June, McInerney's Spanish arm generated an operating loss of €369,000 compared to a loss of nearly €1.4m in the corresponding period in 2008. Club management activities turned a €640,000 profit in the six months to end June 2009.
In its 2008 annual report published last year, McInerney said that it sold seven "high value" apartments in Spain during 2008, compared to 29 in 2007 and 53 in 2006. The units sold in 2008 were offloaded at a significant loss to the group.
McInerney added that the company had a "good strategic landbank in Spain offering potential value for the future", but that the strategy for its operation in the country was to downsize.
Its land and other inventory in Spain was impaired to the tune of €12.6m in 2008 and took a further €4.1m hit in the first six months of 2009.