Mercantile pub group to be split between warring shareholders

Peace deal to see group divided between US-backed investors and Frank Gleeson

 

and Peace has broken out between Dublin publican Frank Gleeson and his fellow shareholders in the Mercantile pub group, following several days of mediation talks last week.

The bitter falling out between Mr Gleeson on one side, and a consortium that includes Irish-American investors and Danu Partners, backed by the founders of Setanta Sports, on the other, spawned three separate legal actions.

Two of those have been resolved, the High Court was told yesterday, while the third looks set to be resolved by the time the parties return to court at the end of the month.

Both sides fell out over a range of financial and operational disputes late last year. This came less than a year after they joined forces, merging Mr Gleeson’s Mercantile group with the Danu and US-backed Capital Bars group, creating a chain of a dozen top Dublin nightspots including the George, Café en Seine, Opium, Pichet and Whelan’s on Wexford Street.

It is understood that the framework of a final settlement has been reached, with the final details due to be hammered out in coming weeks.The deal will involve a carve-up of the various properties between them.

It is understood that the final agreement will cover the future of two north Dublin pubs that currently rest outside the group.

Alleged oppression

In the first proceedings, Mr Gleeson had brought proceedings alleging shareholder oppression in Ardan Advisory Ltd, formed out of the Mercantile/Capital group merger. The other shareholders in Ardan denied his claims in proceedings before the Commercial Court.

The second set of related Commercial Court proceedings were brought by US-based EMI-MR Investment LLC seeking a €4.6 million judgment against Mr Gleeson over loans made to him in 2016.

The loans, the court previously heard, were to fund the refinance/purchase of the Bottom of the Hill pub in Finglas, Dublin, and Gleeson’s pub at Mulhuddart, Dublin, as well as to enable him purchase shares and to pay legacy trade creditors. Mr Gleeson opposed EMI-MR Investment’s action.

Both cases were due before the courts next week but Stephen Dowling, for Ardan, told Mr Justice Robert Haughton at the Commercial Court on Friday both had been resolved.

The matters could be adjourned to May 29th for mention only to allow for implementation of a settlement agreement, counsel said.

Padraic Lyons, for Mr Gleeson, consented.

No details of the settlement arrangement were given.

The third case, brought by Mr Gleeson to prevent the Mercantile Entertainment Group Ltd taking steps to dismiss him from his role as that firm’s chief executive, remains pending before the High Court.

Temporary injunction

Last month, Mr Gleeson secured a temporary injunction preventing the company either dismissing him or continuing with a disciplinary process against him.

The Mercantile Group, which includes the Mercantile on Dame Street, the Green Hen in Exchequer Street and Whelan’s on Wexford Street, merged with Capital Bars in 2015. Capital included Café en Seine on Dawson Street and the George on South Great George’s Street.

Under the merger, Mr Gleeson, of Deerpark Drive, Castleknock, said he held a 30 per cent shareholding in Ardan Advisory, of which the Mercantile Entertainment Group is a wholly owned subsidiary. The remaining 70 per cent is owned by JT Magen (Capital Bars) LLC and Danu Advisory Partners Ltd.