Thomas Read team mounts €100,000 buyout

A management team at the Thomas Read group has secured agreement in principle to buy the pub chain for €100,000 from two of its main shareholders, businessmen Paul Connolly and Hugh O'Regan. The two men are in dispute over a sale agreement in 2002.

The team is being led by businessman Martin Conroy, who is a minority shareholder and a partner of the chain's founder, Mr O'Regan. The group's financial controller, Alan Kennedy, is also involved.

Some of Dublin's most prominent pubs - including the Bailey on Duke Street, Searson's on Baggot Street and the Harbourmaster in the IFSC - would change hands if the buyout goes ahead.

The relatively low price of €100,000 reflects the group's heavy debt burden, which is the region of €21 million. The team will have to make certain guarantees and undertake separate commitments to make significant investments in the chain.

While the deal has not yet been concluded, a sale could be the first step towards a resolution of the legal dispute between the two main shareholders over Mr O'Regan's sale of a majority share in the group to Mr Connolly, a financier.

Mr Connolly's company Guerneville Ltd paid €15 million to buy 60 per cent of the group last year from the vehicle owned by Mr O'Regan and Mr Conroy, Sharmane Ltd. In the High Court last month, Mr O'Regan said the transfer of the remaining 40 per cent for €5 million was delayed because of what he claimed were "irregularities" in the way that Bank of Ireland managed the Sharmane's accounts.

Mr Connolly later offered to assume the potential tax liabilities of the Thomas Read group in order to settle the dispute, but demanded that Mr O'Regan left the group in return for this offer.

Neither Mr O'Regan nor a spokesman for Mr Connolly would comment on the management buyout proposal. However, it is understood that both men agreed in the last fortnight to sell their interests to the team.

Mr O'Regan told the court last month that Sharmane was in financial difficulties although Guerneville said later that its performance had recently improved. The Thomas Read group has a total of 14 bars, including five in Dublin Airport. The others include: Pravda on Liffey Street; Thomas Read's on Dame Street; the 40 Foot in Dún Laoghaire; the Budabar in Blanchardstown; and the Dawson Lounge and Ron Black's on Dawson Street.

Mr O'Regan will retain the Morrison Hotel on Ormonde Quay if the deal goes ahead.