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AIB firm in action against Treasury

AN AIB trust company has initiated High Court proceedings seeking to stop development company Treasury Holdings "spoiling" a proposed €64m sale of the majority shareholding in the Northside Shopping Centre in Coolock, Dublin.

The action by BNY Trust Company (Ireland) Ltd and Ark Life Assurance Company Ltd against Treasury Holdings Ltd was admitted by Mr Justice Peter Kelly yesterday into the list of the Commercial Court, the commercial division of the High Court.

BNY claims it is the beneficial owner of 78.6pc of the Northside shopping centre premises and Treasury Holdings Ltd (THL) is the beneficial owner of 21.4pc of the property, having purchased the interest of Peter Conlan.

The freehold of the centre was held in trust by Percy Nominees Ltd for both it and Mr Conlan, subject to a 99-year lease from October 1976 held by N1 Property Developments Ltd.

BNY claims that it, Ark Life and Mr Conlan entered in November 1998 into a co-ownership agreement with AIB Investment Managers Ltd (AIBIM), which included provisions governing the sale by one party of its interest in the centre.

Discussions took place last year with the plaintiffs and Mr Conlan relating to the sale of their interests in the shopping centre.

In November 2006, the plaintiffs claim a notice under the terms of the 1998 agreement was served on N1 by Percy Nominees, with the agreement of Mr Conlan, offering N1 the opportunity to buy the freehold interest in the centre.

After negotiations, N1 made an offer of €81.75m for the freehold interest. Mr Conlan was notified in January 2007 that this equated to some €17.5m for his share, and that Allied Irish Property Fund and Ark Life were strongly recommending acceptance of this offer.

Mr Conlan responded in late January that he had received a higher offer for his interest and did not wish the trustees to sell at the price offered by N1. He asked that the freehold interest be offered for sale on the open market for the best available price.

The plaintiffs claim that, on February 14, 2007, BNY, as trustee for Allied Irish Property Funds, Ark, and Percy Nominees, entered into a 'put and call' option agreement with N1 and with Brian O'Farrell and David O'Farrell, NI directors, under which the parties agreed to grant 'put and call' options for the plaintiffs' interest in the shopping centre for a price of €64.255m.

However, claims by THL meant the sale of the plaintiffs' interest could not be completed, and the plaintiff companies wanted declarations from the court that THL has no rights under the 1998 agreement.

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