ACCBANK HAS recruited outspoken economist Prof Morgan Kelly to support its case against the Liam Carroll-controlled Zoe Group’s second bid to get High Court protection from its creditors.
Key companies in the group, led by Vantive Holdings and Jersey-based Morston Investments, will today begin their second attempt in six weeks to have former KPMG partner Ray Jackson appointed examiner to the business and get High Court protection from their creditors.
ACCBank is set to oppose the move. The Dutch-owned institution sought the repayment of a near-€64 million loan to the companies last July, sparking Zoe’s first bid for High Court protection, which failed when the Supreme Court ruled it had failed to show it had a reasonable chance of survival. The group has a €265 million deficit and owes ACC a total of €136 million. Its other banks include AIB, Bank of Ireland and Barclays. They support its examinership bid.
Documents filed with the High Court at the weekend show Prof Kelly, who lectures in University College Dublin (UCD), has filed an affidavit in the case.
Prof Kelly is one of three independent experts who have sworn affidavits which were lodged in court on Friday, the deadline for the bank to produce evidence to challenge Zoe’s case that it has a reasonable chance of survival.
He is well-known for his outspoken views. He has strongly criticised the Governments management of the economy during the boom and its handling of the financial crisis, as well as the banks’ and developers’ roles in precipitating the recession.
The bank’s other independent witnesses are Sean McCormack of property company DTZ Sherry FitzGerald, and Simon Coyle of accountancy firm Mazars.
Zoe has sworn affidavits from Goodbody Stockbrokers economist Dermot O’Leary, property experts David Cantwell of Hooke MacDonald and Enda Luddy of CB Richard Ellis, and accountants KPMG. It is understood that Mr O’Leary’s affidavit predicts that the world economy will recover next year with the Republic’s following suit in 2011. A business plan for Zoe hinges on the sale of apartments and other properties picking up in 2011.
Minister for Finance Brian Linehan described as “a very welcome judgment” the Supreme Court’s rejection of an application from insolvent companies in Liam Carroll’s Zoe Group seeking the appointment of an examiner.
The Minister was asked yesterday at an Oireachtas committee about the impact of the rejection of the application by the High Court and the Supreme Court on the National Asset Management Agency (Nama) and the Government’s plan to value property assets.
The High Court has heard that the Zoe Group’s properties could be worth €1.211 billion over three years if existing sites are developed and properties are sold on an orderly basis, but just €644 million if sold over six months at distressed prices. The companies won a reprieve on the basis of new evidence and a revised business plan. The case is expected to last two days.
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