Michael Noonan says he could not stop Nama sale

Minister for Finance answers questions on Project Eagle at Public Accounts Committee

The losing bidder for Nama's Northern Ireland loans may be considering legal action over the €1.6 billion deal, the Dáil's Public Accounts Committee (PAC) heard yesterday.

Committee member Marc Mac Sharry, a Fianna Fáil TD, claimed that US company Fortress, which lost out to rival investor Cerberus in the race to buy the loans, has hired London lawyers Slaughter and May to review the deal.

Fortress and Cerberus became the only remaining bidders for the loans, known as Project Eagle, in March 2014, after another firm, Pimco, was forced out when it emerged it had agreed to pay £15 million to former Nama advisor Frank Cushnahan, Belfast solicitors Tughans and US lawyers Brown Rudnick.

Cerberus succeed in buying the loans with a £1.241 billion bid, an offer which Nama said was more than its reserve price for the assets.


However, a report by the Comptroller & Auditor General (C&AG) Séamus McCarthy estimated the agency could have earned about £190 million more for the assets.

Asked at a PAC hearing yesterday, by Mr Mac Sharry, if they had heard the reports that Fortress had hired lawyers to review the sale, Minister for Finance Michael Noonan, and two of his officials, Ann Nolan and Declan Reid, said they were not aware of this. Nama did not comment.


But, a number of weeks ago, Nama published an email from Fortress – sent after the sale in April 2014 – showing the New York-based investor was not willing to meet the reserve price set for the loans.

Fortress did not respond to a request for a comment.

Mr Noonan stressed several times he did not have the power to halt the sale when he learned of the conflict of interest involving Mr Cushnahan, as the legislation establishing Nama bans political interference.

“It would have been illegal,” he told the committee.

‘Not unusual’

Tughans and Brown Rudnick switched sides to Cerberus after Pimco’s exit.

Responding to Labour TD Alan Kelly, Mr Noonan said neither he nor his department learned of this until recently.

Mr Reid argued it was “not unusual” for professional advisors in auctions to change sides if the client for which they have been working drops out.

The Minister also said he was not aware Mr Cushnahan had met with Pimco in May 2013, while he was still on Nama's Northern Ireland Advisory Committee.

The meeting was also attended by Tughans managing partner Ian Coulter and the then Northern Ireland First Minister Peter Robinson.

Mr Kelly pointed out there was a “pathway” from this to the point where Pimco’s representatives approached Nama directly in September 2013, prompting the agency to decide to sell the loans.

Mr Noonan said keeping the loans until 2020, when Nama was due to finish, was not an option.

He said, in early 2014, the Republic had just left the EU-IMF bailout programme while the European Central Bank was funding its banks.

“The ECB was anxious that Nama complied with the requirement in the legislation to dispose of assets expeditiously,” the Minister said.

Barry O'Halloran

Barry O'Halloran

Barry O’Halloran covers energy, construction, insolvency, and gaming and betting, among other areas