Monday 26 June 2017

Quinn deal with IBRC over €2.8bn debts still on table

ENTREPRENEUR: Sean Quinn is a consultant for QBRC
ENTREPRENEUR: Sean Quinn is a consultant for QBRC

Maeve Sheehan and Ronald Quinlan

Talks aimed at settling the multi-million euro legal actions between the Quinn family and the special liquidators of IBRC were so far advanced that both sides were on the verge of signing a memo of understanding, sources close to the deal told the Sunday Independent.

The talks were designed to end the acrimonious and costly litigation between the Quinns and IBRC over disputed debts of €2.8bn. But civil service officials did not like the shape the deal was taking while the controversy over the Siteserv transaction killed the political appetite to settle the action.

Sources familiar with the Quinn side have claimed that both sides were due to sign up to a memorandum of understanding last week, but the talks stalled in recent weeks because of political pressure over the controversial Siteserv deal.

However, despite claims to the contrary, sources close to the deal insist the "channel of communication" between both sides remains open.

The account conflicts with that given by Minister of State at the Department of Finance, Simon Harris, who said last weekend that the talks had collapsed and would end up back in court.

One informed source said the settlement talks ended following an "edict" from the Department of Finance but this "does not rule out re-engagement at a point in the future". There may be some brinkmanship going on with the Quinns' civil action looming in June, the source added.

The deal would have seen the family drop their court action over disputed loans of €2.3bn and the bank drop its "conspiracy case" against the Quinn family, whom it accused of concealing its €500m property portfolio.

According to sources close to the Quinn family, the family would work with the liquidator to help recover some of the offshore assets that the bank had suspected them of spiriting away.

They include a €60m office block in Hyderabad in India that a Dubai-based company claims to own.

IBRC claimed that the transfer of the property was part of a wider conspiracy to put the Quinn assets beyond reach of the bank.

QBRC, the company that bought back some Quinn companies from the liquidator last year and which now hires the former billionaire Sean Quinn as a consultant, would take over the management of the assets for a fee.

The State would get the bulk of the multi-million euro rent roll. Under the proposed deal, QBRC would also have an option to buy the properties back at full market value at a later stage, with a bottom line price imposed by the State.

Sources said that although no agreement formally went to government, civil servants were opposed to the deal and the controversy over the IBRC debt write-downs in Siteserv and other transactions made it unappetising to government ministers.

An informed political source suggested that the recent reports that there are continued attacks on the former Quinn businesses may have been a complicating factor in the talks. He insisted there are no settlement negotiations with the Quinns and nor is there any prospect of them.

However, other sources close to the deal claim otherwise. "It is fair to say a deal has not been ruled out," a source close to the talks told the Sunday Independent.

"The channel of communication remains open between IBRC and the Quinns. A deal was close. There has been no point of argument that has not been dealt with. They did not reach an impasse."

The Quinns' case is due to start on June 3, but sources said it could be adjourned, because of external legal factors and in addition, the Quinn family want to amend their claim. That delay could allow more time for the talks to resume once the liquidators have completed their work on the IBRC debt write-downs in August.

The political sensitivities arose when the liquidators for IBRC who have been in talks with the Quinns were asked by the minister to review the bank's sale of Siteserv and other transactions involving debt write-downs.

The talks were driven by John McCartin, a Fine Gael councillor and chairman of QBRC.

A deal to settle the acrimonious Quinn dispute would be regarded as a political coup for Fine Gael in the border constituency where Sinn Fein has made its mark, and McCartin could be asked to run for a Dail seat.

A source close to IBRC's special liquidators this weekend said "no settlement talks... are ongoing at present".

IBRC accused the family of trying to put its €500m international property portfolio beyond reach of the bank, because ownership of various assets once in the Quinn empire had been transferred.

Huge legal bills have been incurred by the bank fighting complicated litigation in several countries.

Sunday Independent

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