McKillen making inroads into cutting IBRC debt
Property developer Paddy McKillen, who is engaged in a high-profile battle for control of three luxury London hotels, has cut €90 million off his debt held with the Irish Bank Resolution Corporation in recent months and is poised to reduce it by another €200 million.
Last night, Mr McKillen’s spokeswoman said the debt owed by companies controlled by him now stands at €550 million, some €50 million below where it stood during his High Court battle with the billionaire Barclay brothers in the middle of the year.
Questioned in late May by barrister Kenneth McLean during the High Court case, Mr McKillen said his personal debts to IBRC at that point were about €300 million.
His spokeswoman said last night this figure now stood at €260 million and his corporate borrowing had been cut from €600 million to €550 million.
Mr McKillen told the court he was committed to paying back IBRC €900 million-€1 billion between 2012 and 2014.
“Yes, it has not been fully boxed down because there is a bit of negotiation to go yet, but it is an acceptable repayment,” he then said.
There were indications last night that Mr McKillen, who has refinanced his debts with other banks at face value, is readying to cut another €200 million off his corporate debt held by IBRC over the next two months. The improvement in the debt figures will be seen as justifying IBRC’s refusal earlier this year not to sell his personal debts to the Barclay brothers in a three-part deal reported earlier this week by The Irish Times.
Mr McKillen has lodged the funds necessary to ensure that his stake in the Berkeley, Claridges and Connaught hotels is not diluted in a rights issue pushed for by the Barclay brothers, which closes at 5pm on Monday.
Earlier this week, the Belfast-born property developer said he had the funds “in place” to take up any of the shares in the Coroin rights issue allocated for financier Derek Quinlan, who owns 35.2 per cent if the latter could not take part.
However, it is understood the £62 million needed for Mr Quinlan to take part – loaned to him by the Barclay brothers – was lodged last evening. Mr Quinlan had borrowed from Anglo Irish Bank and Bank of Scotland Ireland to take part in the purchase of the hotels. Later, Anglo sold his debt to Malaysian investors, who sold it to the Barclays.
Bank of Scotland (Ireland) sold its Quinlan debt directly to the Barclays, which means that Mr Quinlan’s participation does not require the approval of the IBRC or National Asset Management Agency, which holds much of his debt.