Hermitage Clinic row deepens as Goodman ally warns board over CEO ‘exit package’

Goodman associate wants board to replace chief executive Eamonn Fitzgerald

 Larry Goodman:  reached an agreement last year to buy out Sean Mulryan’s one-third stake, which would give him majority control of the hospital. Photograph: Eamonn Farrell/Photocall

Larry Goodman: reached an agreement last year to buy out Sean Mulryan’s one-third stake, which would give him majority control of the hospital. Photograph: Eamonn Farrell/Photocall

 

A boardroom row at the Larry Goodman and Sean Mulryan-backed Hermitage Clinic in Dublin has deepened, after an associate of Mr Goodman’s wrote to the chairman confirming he wants the chief executive replaced.

The letter to Paul Keogh from fellow Hermitage director Declan Sheeran, writing on behalf of Mr Goodman’s Parma Investments, also confirmed the billionaire has agreed a deal to buy Mr Mulryan’s one-third stake in the hospital.

The letter also warns that Mr Goodman would oppose any attempt to pay an “inflated exit package” to the chief executive, Eamonn Fitzgerald, who has threatened legal action against the hospital to protect his position. He currently remains in his role.

Mr Sheeran wrote that any legal action taken by Mr Fitzgerald against Hermitage or Mr Goodman’s company “should be vigorously and robustly defended”.

The letter from Mr Sheeran followed a previous legal missive to the Hermitage board from Beauchamps solicitors, representing Mr Fitzgerald, which said that he had been threatened with the sack following, he claimed, his rebuttal of an approach by Mr Goodman last October to buy out his 5 per cent stake.

‘Courtesy call’

The Irish Times reported details of the Beauchamps letter last Wednesday, prompting Mr Sheeran to write to the board two days later complaining of the leak.

Mr Sheeran confirmed that Mr Goodman had met Mr Fitzgerald last October, and suggested it was a “courtesy call” that had taken place while Mr Goodman was at the hospital visiting a patient. He said they had discussed Mr Fitzgerald’s “future plans” but denied Mr Goodman had tried to buy his 5 per cent.

The letter confirmed that Mr Goodman reached an agreement last year to buy out Mr Mulryan’s one-third stake, which would give him majority control of the hospital. It suggested, however, that the deal was conditional on it complying with provisions contained in an existing Hermitage shareholders agreement.

It also confirmed that Mr Mulryan sold Mr Goodman Fonthill House, the former corporate headquarters of Mr Mulryan’s Ballymore property group, located next to Hermitage.

Sack threat

Mr Sheeran’s letter then referred to the view of Mr Goodman’s company “that a change in CEO is warranted”. It denied a previous assertion by Mr Fitzgerald, however, that a sack threat was linked to his 5 per cent stake.

Mr Sheeran said there was no “ulterior motive” and said Parma has “no problem” with Mr Sheeran keeping his stake “on his departure as CEO”.

The letter finally warned against paying Mr Fitzgerald an “inflated exit package” and said any legal actions should be defended.

Hermitage, Mr Goodman, Mr Mulryan and Beauchamps, acting on behalf of Mr Fitzgerald, all declined to comment.

Hermitage, on the outskirts of west Dublin, opened in 2006 and had revenues last year of almost €74 million, although it is heavily indebted. In his Beauchamps letter last month, Mr Fitzgerald strongly defended his performance as chief executive, and said earnings in 2019 would be €11.4 million.