Consortium interested in Anglo

rte.ie/news/2009/0227/anglo.html

WTF?

Sounds like we get a bunch of chancers to take on the good loans and leave us taxpyers with the derivatives and other shite.

Per 8am radio news they are offering to inject €5bn

Now that would really put the shit up the developers.

Government takes the first €750million in losses and consortium the next €750million and the balance is split 50% each.
I can’t imagine the government will let a private equity firm lose on their developer pals.

They may not have much of a choice D_E, they need the money.

It will mean that due diligence will have to be carried out… if they walk away, it will confirm our worst suspicions about the Anglo book.

Haven’t really thought it through fully and we haven’t much by way of details but my gut instincts tell me that it would be better off in state ownership where we can control things as opposed to a situation whereby we only have a minority interest thereby losing control but yet being asked to suffer 50% of the losses.

I don’t like the Irish part of that sentence. :confused:

I wouldn’t go getting my hopes up here. Malbaraca were the crowd that ran the rule over Bank of Ireland, then AIB late last year and decided against the investment. The only way this crowd could make money would be by cherry picking the good assets, but leaving the government backstopping the toxic shit.

I’d gladly give away 50% of Anglo’s losses. I think the country would be in a much better position of anyone except FF handles the repossession of the developers prized assets

Could be a bogus offer, so that the former shareholders can claim that their shares were worth €6bn when it was nationalised.

You’d really need to see the detail. This group wasn’t around when AI shares were in the doldrums. They’re willing to take half of all losses (no caps)? Nevertheless, any deal is worth listening to.

I hope they’re not doing this with a loan from Anglo :mrgreen:

I imagine the ECB and the European competition authority will have a good look at any transaction in which the Irish govt and Irish business become involved. Imo, there is already a suspicion among Europeans that the Irish govt and business interests are willing to exploit the strength of the Euro when it suits their own narrow interests. They can make deals which might leave the Irish nation in financial trouble but allow those who profit from the transactions to know their gains are safely realised and easily transferrable via the Euro out of Ireland or Greece or Italy, etc. (I’m not suggesting their is underhanded dealing in this possible take over. Far from it. Rather, I’m just saying that the regulatory implications and larger macro-Euro implications will not be ignored any longer. This will, of course, apply to all Euro members in a degree.)

Methinks the ECB, Frankfurt and Brussels will be reviewing the decentralisation of regulation in detail and closing off this obvious deficiency in the very near future. De game is changing.

But the question is 50% of what? If Govt only have a minority shareholding then it could be 50% of god knows what, i.e. majority shareholders could easily engage in a little financial ‘engineering’. :wink:

The question that needs to asked is “are there current bank employees behind this?”

I have a feeling that certain directors have tapped US clients and come up with this plan. They maybe behind the scenes, and they could include the ex CEO.

I had a funny thought. What if you sold derivatives along with your private equity investments. And you had sold a mass of them to a particular small bank that had taken huge bets that interest rates would be really low for an extended period and that you were now on the hook for billions. Wouldn’t it make sense to buy that bank and unwind the contracts?

It was just a funny thought… I’m sure it bears no relationship to Anglo, but that situation must exist somewhere?

I didn’t get it there for a second but, you’re thinking a company sold derivatives at high interest rates where the bank who bought would profit if they were low for a long period of time. Right? Ok, it would make sense to try and buy it but, if it was a nationalised bank or supported by a govt. why would they need to be if they knew these returns were probable?