Monday 20 November 2017

Former IAWS director granted vast land option

McNamee facing lawsuit over boomtime deal

Nick Webb

Nick Webb

LISTED food group IAWS, now called Aryzta, gave its former director Ronan McNamee a lucrative 'option' to buy a valuable tract of company-owned land in west Dublin.

McNamee was granted this complex option at the height of the property boom in return for "maximising the value of its existing facilities and lands at Tallaght".

Under the terms of the agreement, McNamee would pay €48m for the land plus 50 per cent of any upside in the value of the property. It is not clear whether any money changed hands for the option.

Aryzta documents indicate the deal was agreed in 2006. The Sunday Independent has seen an email sent to McNamee and other development consortium members dating from mid-July 2006.

Documents show that McNamee's option could not be exercised before July 31, 2009 -- in three months' time

This land is now at the centre of a major lawsuit brought by neighbouring developer Bernard McNamara and James Morrissey, owners of Varleigh. It has been claimed that the land could have been worth €117m if planning had been secured.

"The group considers the case to be without merit. A complete defence to the claim, based on the law and the facts, is being vigorously pursued," said Aryzta.

The IAWS land in Tallaght became surplus to requirements after the bakery firm decided to move to a new €200m factory near Clondalkin. Construction began in November 2006 with production starting in mid-2008. IAWS indicated that it would remain at Tallaght until the new factory was operational.

High-level negotiations were held with Ulster Bank and Kelly Walsh property advisers over the development of a combined site in Tallaght. The failure of a deal to complete had led to the Varleigh legal action.

Aryzta's advisers in Dublin and London declined to comment on the terms or the background of the McNamee option. In response to an emailed query from the Sunday Independent, McNamee's office said it would not comment.

Ronan McNamee made millions when selling his Cuisine de France business to IAWS for £63m in 1997.

The company, which provides croissants and pastries to shops, has been one of the main drivers in the phenomenal growth of IAWS.

After bedding down Cuisine de France in the IAWS stable, McNamee resigned as a director of the listed company in 2003. He became executive chairman of the IAWS joint venture with Canadian doughnut firm Tim Hortons.

He remains close to his former employers.

"The group is happy to maintain its continuing association and involvement with the co-founder of Cuisine de France Ronan McNamee," according to Aryzta prospectus issued last year.

McNamee is also a director of Irish Bakery Inventions ltd, which paid out close to €4.3m in dividends to the businessman and his wife between 2004 and 2005.

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