One More Thing

 

McKillen's Maybourne 'inundated' with interest' Caterpillar nervously waits for deal; Anglo appointments show Corporate Ireland still fishing in same small pond

Maybourne makes positive noises on refinancing

MAYBOURNE HOTELS Group, which owns the luxury London hotels Claridge’s, the Berkeley and the Connaught, says it has been “inundated” with expressions of interest, as it approaches a £600 million (€720 million) refinancing due in December.

One such interested party has been named as Westbrook Partners, a private New York-based real estate investor, in conjunction with another unnamed firm, but there have also been whispers of potential backing from the Middle East as well as the chance that the existing owners will find a way to pump in fresh investment. A spokeswoman says “nothing has been decided” yet.

Maybourne’s shareholders are property investors Paddy McKillen and Derek Quinlan, Manchester-based businessman Peter Green and his family, and Dublin stockbroker Kyran McLaughlin. But it is McKillen who makes the fate of the Maybourne’s refinancing project of interest, given his impending court date versus the State: McKillen is challenging the constitutionality of having his loans, including that of Maybourne, transferred to the dreaded National Asset Management Agency (Nama).

McKillen is unusual among the big Irish developers in that he is in a position to state that he is repaying all of his loans, plus the interest. His argument against Nama is in part based on the assertion that Nama’s type of valuations could drive down the realisable value of his assets.

McKillen’s investments are located in much more stable commercial property markets than Ireland’s. One such investment, small in comparison to Maybourne’s hotel empire, was 11-12 Old Bond Street, which McKillen realised the value of last week.

McKillen bought 11-12 Old Bond Street for £6.8 million in February 2002 with a loan provided by Bank of Ireland. Of late, it has housed outlets of jewellers Omega and Damiani, as well as letting four floors and 3,400sq ft worth of office space.

Through his vehicle Metrospa, McKillen has now enhanced his finances by the best part of £18.2 million – the price at which Metrospa sold its freehold interest in the property last week. The selling price exceeded expectations. The proceeds may yet prove useful as Maybourne restructures its debts.

Caterpillar staff hope for rescue

STAFF AT McCormick Macnaughton in southwest Dublin are holding their breath in the hope that a deal may be brokered in the next few days which will safeguard the future of the company. McCormick Macnaughton is better known as the business behind the Caterpillar machinery brand in Ireland.

Earlier this week it emerged that their brethren across the Border, McCormick Macnaughton (NI) Limited, had struck a deal with Finning International, a leading Canadian distributor. Under the deal, Finning has agreed to acquire certain assets and contracts from the company for more than £3 million. Fifty jobs will be saved as a result.

Reports are that the Canadian giant is in similar discussions with the company in the Republic.

Things are a lot more complicated south of the Border, however. In early June, PricewaterhouseCoopers’s Billy O’Riordan was appointed as a receiver to McCormick Macnaughton and McCormick Macnaughton Power Services, two companies in the McCormick Macnaughton Group.

Two weeks later, Ulster Bank appointed a receiver from Kavanagh Fennell over three other companies in the group – Mac Rental Ltd, Mac Rental Holdings and Mancasal Ltd in an effort to recover debts. The receiver of these three companies continues to control them.

It is understood that PwC, which was also the receiver for the Northern Ireland business, is holding discussions with Finning.

McCormick Macnaughton is owned by businessman Malcolm Macnaughton and has been in existence for more than 60 years. It has branches in Dublin, Cork and Lisburn. Earlier this year the company took up residence at a swanky new head office complex at Aerodrome Business Park at Rathcoole, off the Naas Road in Dublin, moving from its well-known premises near the Red Cow roundabout.

The site was developed just as the property market was beginning to decline, while the company’s core business – the sale and rental of construction machinery – was seriously affected by the collapse in the construction sector.

Staff at McCormick Macnaughton are hoping that some kind of deal will be brokered and it is thought that a decision will be made in the next few days. However, the complex corporate structure of the group – one of the companies now controlled by KavanaghFennell has a number of investment properties – means that a deal will be by no means straightforward.

Until then, it will be a nervous wait for staff.

East seems a bridge too far as Cowen puts off China trip

NOT A day seems to pass without some report hitting our desks expounding the opportunities that lie in Asia. The region, and Asia in particular, largely side-stepped the downturn and is now the engine of global recovery.

News of this economic miracle, and its potential for Irish firms, had reached Merrion Square and Taoiseach Brian Cowen was due to lead an Enterprise Ireland trade mission to China next month.

But now it appears Mr Cowen’s trip is off. It’s much to the annoyance of senior Irish business figures in China who had been laying the groundwork for the trip and now feel they have lost face with with their hosts.

The official line from the mandarins is that the trip was never confirmed and a new date in the Taoiseach’s diary is being sought.

But as recently as last month Minister for Enterprise, Trade and Innovation, Batt O’Keeffe told this paper that the Taoiseach’s trade mission to China in September was one of a long list of measures his administration was taking to get the economy kick-started again.

With the coalition lurching from one potential disaster to the next it looks like local political expediency has won the day and the Taoiseach won’t be heading east until early 2011 at the earliest.

Corporate Ireland still fishing in same small pond

EYEBROWS WERE raised in certain circles when Anglo Irish Bank made three board appointments at the end of May in an effort to put its buccaneering, and costly, past behind it.

The appointments of solicitor Adrian Eames, Teagasc chairman Noel Cawley, and former AIB finance director Gary Kennedy were all approved by the Financial Regulator, but some wondered if it was a sign that the culture of appointing “insiders” to non-exec roles was still holding sway.

Kennedy, in particular, holds numerous directorships of both private and public companies, including pharmaceutical group Elan, sandwich maker Greencore and financial services group Friends First, as well as a number of smaller private companies.

Less than two months later, Anglo is in negotiations with IT services group Calyx on its options for the future. The Maurice Healy-led group owes the bank more than €90 million. A debt-for-equity swap, a management buyout or a trade sale are all understood to be up for consideration.

Kennedy spent almost a year as a non-exec at Calyx during its brief stint on London’s junior market, resigning in July 2007. Anglo has made no secret of Kennedy’s Calyx connection, even referring to it in the press release announcing his appointment.

But it does show the difficulties of cleaning up the mess created by cheap credit if corporate Ireland continues to fish in the same small pond.

Auditor at C&C agm asked to skip 'boring stuff' in report

C&C’S AGM yesterday was wrapped up with a fitting tribute to a man who has devoted 40 years to cider.

Shareholders were treated to a touching video clip capturing the life and times of outgoing chairman, and former group managing director, Tony O’Brien.

Created in the distinctive style of the Bulmers Time dedicated to you advertisements, the tailor-made montage came complete with the same gravel-toned voice-over artist, and the same actors and locations featured in the Bulmers TV campaigns.

The agm was also livened up with some decidedly feisty shareholders.

First of all the company’s auditor was politely requested to skip the “boring, sleep-making stuff” when reading out his report, and confine himself to his opinion.

Another shareholder expressed his disappointment at the dearth of C&C-branded T-shirts, caps and umbrellas.

He wondered what the company had against the Welsh, as the management presentation had focused on Ireland, Northern Ireland, England and Scotland.

The management team moved to appease the outspoken shareholder (who was spotted taking to his feet at a different agm last year to thank management for his free umbrella) with some smooth patter about taking his views on board, but he was not so easily put off.

“What about the branded caps and umbrellas?” he persisted.