Quinn considers challenge to group's administration order
Published 13/01/2011 | 05:00
SEAN Quinn may challenge Quinn Insurance's descent into administration if Anglo Irish Bank insists on excluding the businessman's family from a bid for the stricken insurer.
The news comes ahead of a crunch meeting between Anglo executives and Mr Quinn's lieutenants today, where the Quinn contingent will urge Anglo to reconsider a joint proposal to take over Quinn Insurance Limited (QIL).
Anglo and the Quinn family spent more than eight months developing a joint plan to take over QIL and leverage the insurer to repay €2.8bn worth of debt owed by the Quinns.
Anglo subsequently decided to pursue a bid with US insurance giant Liberty Mutual.
"We're continually urging them to revisit it [the bid decision] and we'll be urging them to revisit it again [at today's meeting]," said Kevin Lunney, a key lieutenant of Mr Quinn and a former general manger of QIL.
If the Quinn family is unable to convince Anglo to revive the joint bid, Mr Lunney said the family would "have to give consideration to" using a legal opinion to challenge QIL's original descent into administration.
"We got that legal opinion a long time ago, but we didn't want to use it if we could pursue a strategy with Anglo [that would save the 6,000 Quinn Group jobs and guarantee repayment of the debt]," he said.
"We still don't want to go down that route, but we'd have to give it consideration . . . that's not a threat, it's just something we'd have to consider."
The legal opinion from a UK firm, seen by the Irish Independent, says the Financial Regulator should not have concluded that the €1.2bn in guarantees offered by QIL subsidiaries impinged on the insurer's solvency.
The impact of those guarantees on QIL's solvency was a key reason for the Financial Regulator's decision to put the insurer into administration last April.
Mr Lunney said the Quinn family's position might change if it was given a "satisfactory explanation" for why its bid was jettisoned in favour of a bid with Liberty Mutual.
The Quinns believe their joint Anglo bid would have secured full repayment of the €2.8bn debt within seven years, by giving Anglo 100pc of QIL's earnings and then selling the company as well as other Quinn assets.