Thursday 22 February 2018

US property group in legal bid to protect secrecy as Anglo loans go up for sale

John Mulligan

John Mulligan

A MAJOR Boston property group with borrowings from Anglo Irish Bank has asked a US court to prevent the institution from disclosing confidential information about its business as the bank's special liquidators try to sell its loan.

The Bulfinch Companies, which specialises in acquiring major properties around Boston, is one of two firms that have asked a Delaware bankruptcy court to prevent the special liquidators of Irish Bank Resolution Corporation (IBRC), formerly Anglo, from divulging the sensitive commercial information to prospective buyers of loans held by the firms with the bank.

In a written statement to the court, the CEO of Bulfinch, Eric Schlager, claims that disclosure of the company's confidential information will cause "significant and irreparable harm". Bulfinch has $1bn (€740m) of property assets, including offices, retail units, R&D centres and laboratories.

Under the terms of its loan agreement, Bulfinch provides IRBC with annual and quarterly financial statements, including details of rent rolls, leases, budgets, forecasts, cash flow statements and projections, pending lease approvals, tax returns and business plans.

None of the information is publicly available.

Bulfinch also says that because under its loan agreement it provides such detailed financial information to IBRC, it ensured when borrowing the money that the loan held with the bank could only ever be sold by IBRC to what's termed an 'eligible assignee'.

Such eligible assignees must be a bank and have sizeable assets. That was to prevent the sensitive commercial information falling into the hands of Bulfinch's own competitors, according to Mr Schlager.

He claims that in 2011, Bulfinch blocked a previous attempt by Anglo to sell the loan to a bank. He claimed in his statement to the court that IBRC liquidators have already divulged details of Bulfinch's loan to at least three groups not deemed to be eligible assignees.

The CEO maintains that competitors with access to the information could solicit tenants and induce them to breach their leases, or fail to renew their leases.

Both MPA and Bulfinch told the court that millions of dollars will be wiped off the value of their properties if they lose the restrictions they negotiated, or that they may have to spend millions of dollars to refinance the properties with an acceptable lender.

US-based Irish developer John Flynn has asked the same bankruptcy court not to recognise IBRC's liquidation in Ireland for the purpose of granting it bankruptcy protection in the United States.

Irish Independent

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