Glass Bottle site loans transferred to Nama

 

THE BANK loans associated with the disastrous €411 million acquisition of the Irish Glass Bottle site in Ringsend, Dublin, in 2006 by a consortium including the Dublin Docklands Development Association have been moved to the National Asset Management Agency (Nama).

The agency has now asked the consortium, Becbay, to submit a business plan before the end of this month. However, the shareholders in the consortium are not co-operating with each other in relation to Becbay’s dealings with the agency.

The Labour Party’s spokeswoman on finance, Joan Burton, submitted questions on the matter in the Dáil recently to Minister for the Environment John Gormley.

Mr Gormley told her that the loans have been moved to Nama.

“Nama has requested Becbay to submit a detailed business plan in relation to its outstanding debts by end July.”

The shareholders in Becbay are Bernard McNamara, Derek Quinlan and the DDDA, with the two developers having their interests by way of representative companies.

A spokesman for Mr McNamara said he had no comment.

A spokesman for the DDDA said it had “met Nama on a number of occasions to discuss the development of a realistic business plan to deal with the issues”.

Mr Quinlan could not be contacted.

It is understood Mr McNamara and the DDDA are dealing with the agency separately.

Ms Bruton said the complex issues involved make it even more difficult for Nama to maximise what it can recover.

In his response, Mr Gormley said a € 288 million loan to Becbay was provided jointly by Anglo Irish Bank and AIB.

“It is a non-recourse loan largely secured against the land, with the exception of € 111.9 million that is secured by guarantees of the three shareholders in proportion to their respective shareholdings.”

He said the authority’s liability arising from the deal at the end of 2009 involved a principal guarantee on its 26 per cent share of the loans, totalling €29.1 million and €5 million interest that accrued on its share of the loans for 2009.

“This leaves a current liability of some € 34.1 million, although interest continues to accrue at a rate of € 5 million per annum until such time as the loan is terminated.”

In its 2008 accounts, filed recently, Becbay wrote off € 452.8 million. The Ringsend site, which is the company’s sole asset, was given a valuation of € 50 million.

“It is unclear as to the terms on which Nama may continue to finance the working capital requirements of the company in the future,” the directors said in their statement with the accounts.

Mr McNamara is suing the DDDA in relation to the deal in a case involving potential damages of many tens of millions.