Partnership to advise McCreevy on privatisation of ICC bank

A partnership group involving the ICC board, staff and Government nominees is to play a key role in advising the Minister for Finance on the privatisation of the bank. The group, which will be set up within weeks, will comprise two representatives each from the Department of Finance, the unions at ICC and the board.

The ICC unions have notified the Department of Finance of their choice of representatives - Mr Bernard Daly who is chairman of the MSF union at ICC and Ms Avril Sheridan.

Both are full-time employees at the bank. The board is expected to be represented by its chairman, Mr Phil Flynn, and the managing director, Mr Michael Quinn. A Department of Finance official will chair the group. The commitment to establish the group, together with guarantees for employees on existing terms and conditions and pension arrangements and an employee share option plan, were major factors in the acceptance by the ICC unions of the Government plan to privatise the State-owned bank. The group will be involved in all the areas of decision making on the future ownership of ICC, except the areas specifically reserved for decision by the Minister for Finance. Mr McCreevy will make the final choice on the criteria to be used to evaluate the bids for ICC, including the ranking of those criteria, and he will decide on the winning bid and on the issuing of the contract for sale of the bank.

However, the group will have an input into the criteria for the sale and will have a meeting with Mr McCreevy before he decides the weighting to be given to the different criteria. It will assess and rank the development plans for the bank submitted by the bidders and pass on its rankings to the Minister. It will be involved in the preparation of the tender documents required for the sale.

In addition to the criteria put forward by the group, Mr McCreevy will be advised on criteria by the advisers he will appoint to the sale. Advisers are expected to be appointed towards the end of October following the advertisement of the jobs in the Journal of the European Communities. Many of the fears of ICC employees about the change in ownership have been allayed by the agreement already reached with Mr McCreevy that there will be no involuntary redundancies and that the terms and conditions of employment and pension provisions will not disimprove. Solicitors retained by the ICC unions are currently working on a draft legal wording of these conditions for inclusion in the tender document. In addition, most of ICC's 310 employees will benefit from an employee share option plan. While the details are yet to be negotiated, they are expected to get shares on terms similar to those agreed for Telecom employees - ownership of about 5 per cent of the bank free of charge with an option to buy an additional 9.9 per cent at a discount of about 20 per cent on a market price.

While the Department is unlikely to agree any ESOP structure before it appoints its advisers, the union is determined that no tender document is issued without the inclusion of the conditions agreed with the Minister. The ICC union committee will analyse the development plans submitted by the bidders for the bank to ensure they meet the terms and conditions already agreed with the Minister. The plans will be assessed "to make sure the bidders mean what they say", according to Mr Daly.

Each bidder will be asked to agree to union recognition and to partnership arrangements, though those conditions will not be set out in the tender document. With the separate advisers to the Minister and the ICC not expected to take up their positions until late October, it will be some time before the Minister will be in a position to seek expressions of interest from prospective advisers.