FINANCIER Mr Dermot Desmond and the chief executive of Gandon Holdings, Mr Michael Cullen, have made an offer of over £3 million for Gandon's futures fund management. If the deal goes ahead, Mr Desmond will have 75 per cent of the business with Mr Cullen holding the remaining 25 per cent.
Mr Desmond could not be contacted for comment, but informed sources said that the deal is "80 per cent likely" to go ahead, with the futures fund management business possibly being absorbed into Mr Desmond's International Investments and Underwriting business at the IFSC.
The completion of the deal would result in Gandon Holdings having no assets other than £20 million in cash which would then be distributed to shareholders.
The Gandon futures fund management business has about $200 million under management, mainly for American clients, and is thought to have made between £750,000 and £1 million last year. It is the largest business of its type in Ireland, among the top three in Europe among the top 15 futures funds businesses in the world.
In February last year, Gandon's rate risk management and structured finance operations were acquired by Woodchester for an estimated £6 million, a move that saw Mr Cullen move over to the treasury director position at Woodchester. It is understood that Mr Cullen's 25 per cent stake in the futures fund management business - if the acquisition is completed - will be a simple investment.
The expected saute of the futures fund management is likely to result in the distribution of the £20 million cash to Gandon's shareholders and the likely voluntary winding up of the company. It is understood that £5.6 million of Gandon's cash was distributed to shareholders last year.
Gandon was set up in 1988 by former Citicorp executive Mr Tim Brosnan with £33 million backing from Irish and British institutions.
Mr Brosnan - who left the company three years after it began trading in 1988 - still has a 16 per cent shareholding in Gandon and stands - to receive £3.2 million from the distribution of the Gandon cash. Three directors of Davy Stockbrokers - Mr Kyran McLaughlin, Mr Brian Davy and Mr David Shubotham - have stakes of around 7.5 per cent, and stand to receive around £1.5 million each from the distribution Mr Cullen, has a 2.8 per cent stake and would receive £560,000.
The biggest institutional shareholder is Bank of Ireland with just over 10 per cent, Irish Life has 5.4 per cent while Davy Stockbrokers, has 4.7 per cent.
