No choice but to accept defeat
THE FIGHT was over for Treasury Holdings, the globetrotting property company run by high-flying developers Johnny Ronan and Richard Barrett.
KBC had presented an application to the High Court seeking to wind up the 23-year-old property business over a debt of about €55 million arising from the funding of the Spencer Dock office development in Dublin.
The National Asset Management Agency, which holds about €1 billion of the company’s €2.7 billion debts, had rejected the latest proposals that would have avoided the liquidation of the company, sources close to the business said.
US investment bank Morgan Stanley had recently offered to buy Treasury’s debts from Nama but the State loans agency had rejected this, these sources said.
Nama said a better offer could be presented, the sources said, and Treasury had even suggested the company be sold at public tender, with either Ronan and Barrett remaining on or standing down, as an alternative to save the business.
In the end, Treasury believed there was no chance of Nama agreeing to a deal where the two men would remain on as owners.
For Treasury, the prospect of an investor coming in pre-liquidation was hopeless – the group had no choice but to accept defeat and felt it best to surrender earlier to avoid prolonging the inevitable.
It’s not clear what Nama’s take is of the recent background manoeuvres as the State loans agency has declined to comment.
What is clear though is that Nama held all the cards after the High Court rejected Treasury’s action against the agency’s decision to call in its loans in January.
KBC’s action may have brought Treasury down but the insolvent company’s battle with Nama and the litigation between the parties were the catalysts for its demise.
Mr Justice Brian McGovern was told by lawyers for KBC yesterday that it will seek to appoint Michael McAteer and Paul McCann of Grant Thornton next Tuesday as joint liquidators of Treasury and a further 16 related companies, given the business’s global reach.
Receivers from PricewaterhouseCoopers and Ernst Young, acting for Nama and a syndicate of banks, have already been appointed over various property assets within the Treasury group.
Nama had not taken enforcement action against other Treasury assets including the five-star Westin and Ritz-Carlton hotels in Dublin and Wicklow.
The imminent appointment of liquidators to Treasury will not mean the closure of these hotels: they will remain open as the companies behind them are solvent, even if their parent is liquidated.
The liquidators will also decide whether any of Treasury’s 35 head office staff in Connaught House in Dublin will remain on working for them. So Tuesday will mark the end of one of the State’s most prolific developers, a poster boy of Ireland’s giddy building boom.