O'Brien claims Maloney wanted to 'derail' Esat deal

The Moriarty tribunal heard accusations this afternoon that a former East Telecom chief executive was trying to "derail" the flotation of the company in1997.

Mr Denis O’Brien told the tribunal he felt Mr Barry Maloney was trying to scupper the deal "for a number of reasons".

Mr O’Brien said he felt Mr Maloney had introduced the whole notion of an "intermediary" or "third party" betweenhim and the former Fine Gael minister Mr Michael Lowry, in order to discredit him.

The accusations centre around Mr Maloney’s claim that Mr O’Brien told him during a jog in the Wicklow hills he had made two payments of £100,000 to an unspecified person.

Mr Maloney said he was of the view no actual transaction had taken place, but Mr O’Brien had involved an "intermediary" between himself and Mr Lowry.

Mr O’Brien has admitted to the tribunal he made these remarks, but they were "a joke".

"The conversation was very light-hearted. We were two people who had known each other for 22 years."

"There was no payment," Mr O’Brien said.

However, Mr Maloney raised his concerns with the board of East Digifone in 1997, just weeks ahead of the proposed flotation.

The board held a meeting in early November 1997 to discuss the implications of this, and of a payment of $50,000 to Fine Gael by Telenor at Mr O’Brien’s behest.

Mr O’Brien insisted under questioning from Mr John Coughlan SC for the tribunal, that he meant his bank, Woodchester, when he had said "intermediary". In any case, no money changed hands, he said.

"It was a general Esat Digifone view that Mr Maloney was trying to derail the IPO," he said.

"Be very careful, Mr Maloney’s reputation is at stake here," said Mr Coughlan.

"Yeah, and so is mine," answered Mr O’Brien. "I don’t know where the word ‘intermediary’ came from. I don’t recall ever using that word, or ‘third party’."

In further heated exchanges, Mr Coughlan asked, if Mr O’Brien was of the view then that Mr Maloney was trying to "scupper the sale", did he ever object to his accusations?

Mr Coughlan: "Did you not, in pursuance of your own interest, object at any meetings [with the board of Esat Digifone] to the use of the expression ‘intermediary’ being used?"

"There was a lot of heat at the time. I kept my private thoughts to myself," Mr O’Brien replied.

The tribunal continues tomorrow.