Quinn Group has 'no plans' to sell assets to reduce debt

THE QUINN Group, the conglomerate whose interests include insurance, cement, hotels, glass and property, has no plans to sell…

THE QUINN Group, the conglomerate whose interests include insurance, cement, hotels, glass and property, has no plans to sell any of its assets to reduce its indebtedness, a spokesman said.

The group was responding to queries about reports suggesting that State-owned Anglo Irish Bank was in discussions with the Fermanagh-based business about restructuring its debts ahead of the bank’s own reorganisation.

“The Quinn Group is well able to pay its debts and has no plans for any asset disposals,” said a spokesman for the group.

The group has loans of more than €2.5 billion with Anglo, making it the bank’s largest borrower. Further borrowings are owing by the group to other banks and bondholders in a syndicated deal. Some €1.3 billion was owing on this facility at the end of 2008, according to the group’s accounts.

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The spokesman declined to comment on the scale of the group’s debts. Anglo had no comment.

Seán Quinn, the group’s chairman, is said to be comfortable with the group’s borrowings and its ability to repay them.

The Sunday Times reported last weekend that talks between Anglo and the group centred on a range of potential actions to reduce the bank’s loans to the group. These include a possible debt-for-equity swap, where the State-owned bank would take a stake in the Quinn Group, the newspaper reported.

Anglo is seeking to cut its exposure to the Quinn Group, which accounts for more than 3 per cent of Anglo’s €72 billion loan book, as the bank seeks to restructure itself over the coming year.

Under proposals submitted to the European Commission, Anglo plans to split into a good and bad bank after selling €36 billion in loans to the National Asset Management Agency and reinvent the good element as a business bank.

The Quinn Group has said that the Quinn family, the group’s shareholders, plans to convert the business into two publicly quoted companies by the end of 2015.

The group made a pretax profit of €83.4 million from sales of €2.2 million in 2008, compared with a loss of €425 million the previous year as the group took heavy write-offs as a result of the Quinn family’s investment in Anglo.

The group has written off almost €1 billion on the Anglo investment, which has cost the family well in excess of €1 billion.

The family amassed an indirect shareholding of 28 per cent in Anglo before taking a direct stake of 15 per cent in the July 2008.

This investment has been virtually wiped out.

The group said that its syndicated bank loan facility was due for renewal in October 2010 and that it was satisfied this would be refinanced well in advance of then.