Thursday 18 January 2018

Smyth gets second chance to win back control of Alburn


Donal O'Donovan

Donal O'Donovan

NOEL Smyth has a second chance to win back control of his €150m UK property empire, after plans by lenders to sell off the assets were postponed last night.

Mr Smyth controls Alburn Real Estate, a portfolio of 45 UK commercial properties financed by a complex, multi-layered, debt structure.

The company is in default on some of its €214m of debt and an effort to restructure the debt has been dragging on for months.

The latest delay in the sale process gives Mr Smyth a new chance to win over lenders to his plans to retain control of the properties.

The fresh chance comes just a week after financial advisers Brookland Partners recommended that all the assets be sold off to pay off debt, after rejecting a rescue plan put forward by Mr Smyth.

Now Mr Smyth is understood to be working with US investors Lone Star on a new proposal to win back control of Alburn, by buying some of the outstanding debt at a discount.

Lone Star declined to comment and Mr Smyth could not be reached last night.

Yesterday in a stock market announcement Rothschild, which manages the complex Alburn debts for lenders, said plans for a sale had been delayed.

Rothschild said it would suspend taking any action in respect of "an enforcement and disposal plan" recommended to it by its advisers, until at least December 21.

The delay comes because Rothschild cannot press ahead with a sale until a "special servicer" is appointed to look after the Alburn loans.

A "special servicer" is an agent with the powers to manage debt structures following a default. Under the Alburn contracts the appointment can only be made by the holder of one specific piece of the multi-layered debt structure.

The debt in question was sold in recent weeks to a company called Pearsanta, controlled by Irish investor Vincent Barrett. Rothschild said yesterday that Mr Barrett had so far failed to confirm a special servicer.

It means the bank has had to delay sale plans, and gives Mr Smyth, and Lone Star, a chance to fight their way back into the deal.

Irish Independent

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