NAMA drops bid to takeover €1.4bn of McKillen loans
Published 15/07/2011 | 11:34
NAMA has dropped its attempt to acquire €1.4bn in loans by companies owned by Paddy McKillen, the Supreme Court heard today.
Lawyers for Mr McKillen said they had received a letter from the Government agency designed to buy up property loans from banks stating it no longer intended to acquire the loans, which were at the centre of a legal battle between Mr McKillen and Nama.
It is understood Mr McKillen will be awarded legal costs, estimated to be worth several million, against NAMA.
The notoriously publicity-shy Mr McKillen, whose assets include a part share in Dublin's Clarence Hotel with U2 band members Bono and The Edge, had always claimed his loans were being repaid and had no place in NAMA.
However, it is understood that €700m of his loans are already with the agency.
Mr McKillen’s original challenge against the agency related to the proposed acquisition of loans of over €200m with Bank of Ireland.
A spokesperson for NAMA said the decision was taken because the exposure of the loans to land and development has fallen “significantly” since 2009 when the original NAMA decision was taken.
This is the second blow to the agency in relation to the case.
Earlier this year, he won part of his challenge to NAMA.
In February, the Supreme Court ruled that the NAMA’s plans had no legal effect because of the timing of the decision.
It ruled that the decision was taken by an interim team on December 11 and 14 2009 - before the establishment of NAMA on December 21.
Contrary to an earlier High Court judgment, the interim team's decision was not given legal effect by any subsequent act or series of acts by NAMA.
It stated the question of whether NAMA had made a decision to acquire Mr McKillen's assets was not a purely technical and formal one. It added such a decision was an essential step in the statutory process.