IBRC liquidators and Russian asset recovery firm agree to delay sale of former Quinn family assets
Published 07/07/2015 | 12:54
IBRC special liquidators and Russian asset recovery firm A1 have agreed to delay the sale of key former Quinn family assets in Russia and the Ukraine until the economic situation there improves, it has been announced.
The special liquidators said assets secured by the Irish State include a skyscraper in Moscow, a shopping centre and a logistics park.
But their value has fallen by an estimated $80m over the last two years as a result of the political crisis that has engulfed both Russia and the Ukraine, according to IBRC’s special liquidators.
A revised deal has been drawn up between A1 and the special liquidators which involves holding on to the assets for longer.
IBRC formed the joint venture with A1 in February 2013 to recoup key property assets in Russia and the Ukraine linked to Sean Quinn.
Mr Quinn, once the country’s richest man, was one of biggest foreign investors in Russian commercial property during the Celtic Tiger years before he went bankrupt in January 2012.
IBRC special liquidator Kieran Wallace said the joint venture approach has worked well.
“The revision of the joint venture agreement with A1 makes commercial sense at this juncture as it is in the best interests of the State that these assets are not sold now at seriously depressed prices,” he said.
“We will continue to benefit from the income generated from the secured assets and to work hard to recover more assets which are the legitimate property of the Irish State.”
As a result of the joint venture to date, control has been secured over Q Park, a major logistics facility in the city of Kazan, the Kutuzoff Tower, a prime office block in Moscow and the Univermag Shopping Centre in Kiev.
In a statement, the special liquidators said that since the joint venture was established over two years ago, the value of the Rouble and the Ukrainian Hryvnia has fallen significantly against foreign currencies and commercial property values have plummeted.
“Due to these factors, the sale of recovered assets will not, in the view of the Special Liquidators following the receipt of specialist property advice, generate the level of interest or return in the immediate future that could be generated in the medium to long term once stabilisation occurs,” the statement said.
The combined estimated value of the assets is up to $120m. This compares with an estimated value in the region of $200m in 2013.
Under the revised agreement, A1 will sell shares which derive their value from an economic interest in the recovered assets and associated cash reserves and future rental income, together with recovery claims and recovery proceeds, for a payment pf $34m and a continuing opportunity to benefit from 20pc of the value of any further assets recovered over the next six months.