In short

A roundup of today's other business news in brief

Boundary Capital warns Arnotts investment may be worthless

Listed private equity firm Boundary Capital, which was founded by financier Niall McFadden, has warned that its investment in Arnotts is likely to be worthless because of the debt level of the Dublin retailer.

Art Holdings, which owns Arnotts, is currently negotiating new banking facilities with its lenders Ulster Bank and Anglo Irish Bank.

In a statement to the Irish Stock Exchange yesterday, Boundary Capital said these negotiations were likely to result in restructured facilities and that the level of Arnotts’s borrowings meant that there was unlikely to be “any material value” in its investment in the company.

In 2007 Boundary Capital acquired 28 per cent of Arnotts for €40 million. Mr McFadden played a key role in building up Arnotts’s property portfolio, which was supposed to lay the foundation for its €800 million Northern Quarter project in Dublin’s north inner city.

However, this project has been shelved, at least temporarily, due to the economic downturn.

In 2003 it was reported that the Arnotts staff pension fund would be used to cover some of the company’s property acquisitions in Dublin city centre. However, a spokesman for Arnotts said the pension fund was not, in fact, used to acquire properties for the Northern Quarter project.

Bank gets €1.2m judgment against Leitrim businessman

A High Court judge has ruled that ACCBank is entitled to summary judgment for €1.2 million against a Co Leitrim businessman over unpaid loans.

As Raymond O’Hagan, Skreeny, Manorhamilton, failed to appear at the proceedings against him, Mr Justice Peter Kelly yesterday told Bernard Dunleavy, for ACC, that the bank was entitled to secure judgment in the amount sought.

The action arose following a number of loans to Mr O’Hagan by the bank’s Sligo branch from 2003 to 2006. They included €587,000 to buy a residential investment property at Castle Street, Manorhamilton, and another loan to refinance Mr O’Hagan’s existing debt relating to the Castle pub in Manorhamilton. A €1 million loan was advanced in 2004 to refinance his existing balances and to fund the purchase of another residential investment property at Castle Street.

Eni withdraws bid to buy Heritage Oil’s stake in Ugandan oil fields

Italian energy giant Eni has formally withdrawn its bid to buy the Heritage Oil-owned Ugandan licences for which Irish company Tullow has offered $1.5 billion (€1.1 billion).

The move will put an end to speculation that the Ugandan government favoured Eni’s bid for a stake in two lucrative oil fields over Tullow’s offer.

Tullow and Heritage own 50 per cent each of the oil fields, located in Uganda’s Lake Albert Rift Basin.

Eni’s bid for Heritage’s stake triggered Tullow’s right to pre-empt any offer with a bid of its own. The Irish company subsequently offered to buy out Heritage.

Heritage shareholders accepted this two weeks ago, but there was speculation that the Ugandan government, which controls the oil exploration licences, favoured letting the Italians buy out Heritage.