Saturday 20 January 2018

McKillen to resume hotel court battle with Barclays

Ronald Quinlan

Ronald Quinlan

PROPERTY tycoon Paddy McKillen's relentless battle with the billionaire Barclay brothers for control of the world-renowned Claridge's, Berkeley and Connaught hotels is back before the High Court in London this Thursday.

Having suffered a setback two weeks ago with the Supreme Court refusing to hear his appeal against an earlier defeat, this time the Belfast-born businessman is fighting a claim being brought by the Barclays and their key ally in the battle for Coroin, high-flying financier Derek Quinlan.

Central to the Barclays' and Mr Quinlan's case is their belief that Mr McKillen's 36 per cent shareholding in the company behind the London hotels should be offered for sale as part of the IBRC liquidation process. In his pleadings, Mr Quinlan is seeking a declaration from the Court that the security over Mr McKillen's shares has become enforceable as a consequence of the Government's decision to pull the plug on the bank.

Pointing to Mr McKillen's granting of a charge over his shares in Coroin to the IBRC prior to its liquidation, Mr Quinlan argues that the Special Liquidators of the bank should now be entitled to offer them for sale. The financier believes such a sale would take place under the so-called pre-emption clause in the Coroin shareholders' agreement.

Under that clause's terms, any shareholder of Coroin seeking to sell or transfer ownership of their shares must offer them first and on a pro-rata basis to existing shareholders. The Barclays, for their part, have made similar claims in their pleadings to the Court.

While Mr McKillen's spokesman declined to comment yesterday on this week's hearing, the Belfast-born businessman's attitude to the validity of the claim against him was made clear earlier this year.

"It's news to us. What they are suggesting sounds like complete nonsense," his spokesman said when he was asked for reaction to the pleadings.

Mr McKillen has long argued that Mr Quinlan's shares should already have been offered up for sale under the terms of the pre-emption clause.

Having failed so far to convince the courts of this, Mr McKillen believes it is only a matter of time before the Barclay brothers withdraw their financial support for Mr Quinlan in a move that would threaten his solvency and trigger the sale of his own Coroin shareholding.

The Barclays and Mr Quinlan want to have their claim against Mr McKillen heard in the English courts.

However, he has applied for an order to have it dealt with in Ireland on the grounds that the Coroin shareholders' agreement is an Irish document written under Irish law, the IBRC is an Irish bank and the IBRC Act is an Irish law.

Mr McKillen is also expected to argue that both he and Mr Quinlan are Irish citizens and should therefore have their issues dealt with here.

Sunday Independent

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