SHAREHOLDERS IN Irish Life & Permanent have brought a legal challenge aimed at setting aside the High Court’s approval last month for the Minister for Finance’s purchase of the group’s life assurance business Irish Life for €1.3 billion.
The High Court made direction orders under the State’s emergency banking legislation, the Credit Institutions (Stabilisation) Act 2010, allowing the Minister to buy Irish Life from the company.
The proposed sale is part of the recapitalisation of Irish Life & Permanent as directed by the Central Bank, the EU Commission, the IMF and the ECB, and will result in the separation of the group’s life assurance and banking businesses.
The €1.3 billion purchase will complete the €4 billion recapitalisation of Irish Life and Permanent. The court was told that it was in the best interest of the State, the company and shareholders.
A group of Irish Life & Permanent shareholders took a legal action earlier this week seeking to have the direction orders set aside.
The action was taken by Gerard Dowling, Pádraig McManus, Piotr Skoczylas and his company, Malta-hedge fund Scotchstone Capital, who are also contesting the Government’s move to seize control of the company through the recapitalisation of the company.
During a vacation sitting of the court yesterday, Mr Justice Patrick McCarthy granted permission to Irish Life Permanent to bring a motion seeking to have the company included as a notice party to the challenge by the shareholders.
Brian Kennedy, for the company, told the court that anything concerning the proposed €1.3 billion sale of Irish Life would affect the company. He asked that the matter be given priority.
The company’s motion will be heard before Mr Justice Nicholas Kearns when the courts return from their Easter holidays later this month.
Before approving the proposed sale last month, Mr Justice Kearns was told the Minister had decided to buy Irish Life after efforts to sell the business privately had failed. The Minister decided to acquire Irish Life after consultations with legal and economic advisers.
The court ordered that the sale be executed after April 13th and completed by the end of June.
The Government took 99.2 per cent ownership of Irish Life & Permanent after injecting €2.7 billion into the company in July 2011.
In the separate legal proceedings, Mr Skoczylas claims that the Government’s decision to seize control of the company through recapitalisation put an unacceptable burden on Irish taxpayers.
