Irish Times: Fleming in Talks With ACC
irishtimes.com/newspaper/fin … 93050.html
By SIMON CARSWELL
CORK-BASED developer John Fleming is in discussions with ACCBank about restructuring the debts of one of his property firms which was placed under the protection of the High Court last week.
Last Wednesday the bank appointed a receiver, Padraic Monaghan of KPMG, to a company called Tivway which is involved in the development of a commercial building in Sandyford, Co Dublin, over debts of about [euro]20 million.
However, the company successfully applied for the protection of the High Court last Friday after it sought the appointment of an examiner.
The receiver agreed to stand aside pending a hearing on the
appointment of the examiner.
ACCBank is understood to be opposed to the appointment.
The Fleming Group is primarily financed by AIB, though it has also drawn borrowings from Anglo Irish Bank, EBS building society and Bank
of Scotland (Ireland).
provost edit: changed title to: The Fleming Group and ACCBank
from todays IT:
Mr Fleming is one of the most prolific developers in Munster. He built and owns a number of hotels including the lodge and spa at Inchydoney in west Cork, the Radisson Hotel in Limerick and the Sheraton hotel and golf resort at Fota Island in Cork.
His construction group has built projects in the industrial, energy and pharmaceutical sectors.
The court was told yesterday that the group’s 650 employees were at risk if ACC successfully appointed a receiver to take control of Tivway as it would have a knock-on effect given the “inter-dependency” between companies within the Fleming group.
Lyndon McCann, Tivway’s legal representative, told Mr Justice Brian McGovern that if the company folded, Anglo Irish would have “no alternative but to engage in the unpalatable action of calling in the debt”, leading to the collapse of the group and the threat to the employees.
ACC opposed the appointment of the examiner, saying it did not make commercial sense for a firm with only two assets, including a partially-built office block in Sandyford, Co Dublin, that needed up to €6.5 million to complete.
The bank made reference to a note in the company’s papers which said that it would seek the appointment of an examiner “in order to cram down ACC”.
ACC has adopted an aggressive approach in the pursuit of loans to the beleaguered development sector, taking a series of legal challenges to recover unpaid debts.
The court was told yesterday that the bank’s move against Mr Fleming’s company was
also an attempt to realise its security before the State’s “bad bank”, the National Asset Management Agency was established.
Would someone who knows stuff care to comment on why one bank (ACC) would oppose examinership and another (Anglo) be in favour? Is Is Anglo’s stance in the best interests of the shareholders (ie us?)
there’s a thread discussing how it could be about NAMA:
I posted in the ACC thread the headline in the Indo is that 2 white nights are looking at investing €bn and saving the 650 jobs, …Spin it keeps Ireland turning
Thanks - saw that. There’s so much happening so fast, and it’s all interconnected, that it’s hard to know which thread to put stuff.
Is it all a big poker game for these guys - are they waiting to see who folds first? Or are they sitting in their gated country mansions, knowing that It Has All Been Taken Care Of and will soon blow over? Or are there tense and desperate meetings going on with banks, other developers and politicians all over the place? Somehow the last seems doubtful - some rumours surely would have surfaced?
Kinda funny, isn’t it, that dour old slowpoke Agricultural Credit Corporation should turn out to be the shiny Pin after all!
I know its hardly this straightforward, as any foreign player could have made a move, etc, but there is a morsel of irony in the fact that the Gov only sold ACC a few years back and now they’re threatening to derail the whole ‘plan’.
is there another thread discussing this court case today, I’ve tried the search engine, but couldn’t find one
Can we expect appeals in this also?
Wednesday September 16 2009
Lawyers for two companies in the Fleming construction group are seeking to be placed under court protection as part of its bid to save the business.
One of the key companies, Tivway, had an examiner appointed in July after ACC sought the repayment of a debt of over €21m.
Two other companies, John J Fleming Construction and JJ Fleming Holdings, are now making an examinership bid.
The group has debts to various banks of over €1bn.
Fleming firms get court protection
The move means all three have the court’s protection from their creditors until October 17th, when the examinership period ends.
Making his ruling this morning, Justice O’Keeffe said that in his opinion, examinership would be a preferable course of action for the companies than winding up.
preferable for them alright
Rescue plan drawn up for Fleming Group ->
sbpost.ie/news/ireland/rescu … 44953.html
A rescue plan will be tabled this week for the Fleming Group, the Cork building firm that is in examinership with €1 billion in debts.
Under the deal, creditors will write off most of their debts, and a newly-created firm will take over large parts of the group’s assets. The firm’s three main lenders have agreed to provide additional finance, and an unidentified new investor is proposing to invest €4 million to bail out three companies in the Fleming Group.
The scheme involves setting up several new ‘reserve funds’ to pay off creditors over a ten year period, with payments based on the company’s performance.
The Fleming Group is one of the biggest construction firms in the country, but went into examinership three months ago after ACC Bank called in €22 million in loans from a subsidiary called Tivway.
there is more
Once again we have that figure of 25% for non-performing loans. The aspirational 50% figure is just that, aspirational.
Based on my semi-random calculations given that Zoe was also ‘worth’ 25% of its debt:
NAMA 77 bn original loan value
60% non-performing: 46.2 bn
40% performing: 30.8 bn
Recovery rate on performing: 100%
Recovery rate on non-performing: 25%
NAMA loss: 11.65 bn
But let’s suppose that over time we get to (which I believe will be best case):
Recovery rate on performing: 80%
Recovery rate on non-performing: 40%
NAMA loss: 10.88 bn
Now let’s suppose that we instead get (which I believe will be worst case):
Recovery rate on performing: 60%
Recovery rate on non-performing: 20%
NAMA loss: 26.28 bn
THE EXAMINER of three companies in the building group owned by Cork developer John Fleming has warned creditors that if a legal claim by ACCBank is successful they will be paid significantly less under the rescue plan.
George Maloney of Baker Tilly Ryan Glennon told creditors in a letter sent this week that they are entitled to attend a High Court hearing next month and make submissions on his survival plan.
The court will decide at the hearing whether to approve the plan for the group, which has debts of €1 billion, employs 650 people and comprises 31 companies.
ACC failed to prevent the appointment of an examiner to another company controlled by Mr Fleming called Tivway last August as it attempted to recover loans of €21.5 million owing on a development in Sandyford, Co Dublin.
Mr Maloney said in the letter that he was disputing ACC’s claim that it should be treated as an unsecured creditor of John J Fleming Construction Company, Mr Fleming’s main building company, which is also in examinership.
The accountant argued that ACC is a “contingent creditor” of the construction company, which would mean that the bank would not be repaid until 2020. Under the survival plan, unsecured creditors would be paid 25 per cent of their outstanding debt on or before December 18th, with a second payment on or before February 28th, 2010. A third and final payment may also be made.
irishtimes.com/newspaper/fin … 93497.html
Strange bit at the end , someone will allegedly ‘invest’ €4bn, get the hell out of it willye
Under the plan, unsecured creditors will have to write off most of their debt in a deal that will lead to a company, Donban, backed by an unidentified investor, taking over large parts of the group.
The investor is proposing to invest €4 billion, while the group’s three main lenders are willing to provide a further financing. Anglo Irish Bank is prepared to support the plan with €266 million. AIB and Bank of Scotland (Ireland) are willing to provide €130 million and €48 million respectively.
The plan involves the creation of several “reserve funds” to repay creditors over 10 years based on the company’s performance.
I’ve heard third hand that the Rabo executives are flippin furious with the Irish ACC management and with the ACC customers.
They are Dutch and they’re pissed off
calvinist instincts are gone off the scale
They just want no more bullshit and to sell off everything as soon as possible for whatever they can get.
They aren’t prepared to listen to any more fairy stories about the fundamentals.
Fleming begs for early court decision ->
An appeal by ACCBank against the implementation of a survival scheme for the Fleming construction group must be heard soon if more than 300 jobs are to be saved, the Supreme Court was told today.
Lawyers for the group, its examiner and its biggest creditor, Anglo Irish Bank, stressed that the future of the group is dependent on the speedy implementation of the survival scheme for three key companies.
there is more
Fleming rescue plan could cost ACC over €20m ->
sbpost.ie/news/ireland/flemi … 46223.html
ACC Bank could be forced to write off more than €20 million it is owed by the Fleming construction group if a rescue plan for the firm is given the go-ahead.
The bank will this week tell the Supreme Court that it would face a 95 per cent hit on its loans to the Fleming group if the court upholds a ten-year rescue package for the debt-laden business.
ACC will argue that the scheme, prepared by a court-appointed examiner, is prejudicial to its interests and is an abuse of the examinership process.
The Fleming group owes €21.5 million to ACC, but the bank contends that it would be left with assets worth just €1 million if the rescue plan is approved. ACC is appealing a decision by the High Court to approve the scheme of arrangement for the group, which has total debts of €1 billion.
there is more
Who do i believe in this saga - funnily enough ACC rather than anyone else
ANGLO IRISH Bank is prepared to commit some €2 million, mostly to pay unsecured creditors but also to provide some working capital, in an effort to procure the survival of key companies in the Fleming construction group, the Supreme Court was told yesterday.
The five-judge court, presided over by Chief Justice Mr Justice John Murray, heard further submissions yesterday in the appeal by ACCBank against the High Court’s approval for the 10-year survival scheme drafted by the Cork-based group’s examiner and supported by all creditors except ACC. The appeal is expected to conclude today and judgment may be reserved.
The group has debts of some €1 billion, including €260 million to Anglo and some €22 million to ACC, and 137 jobs are involved.
irishtimes.com/newspaper/fin … 36695.html
Good idea, lets use taxpayers cash to keep 137 jobs in a company that is insolvent and has no future. Never thought of that.
(Gets up to bring in another basket of turf)
Slean agus beannacht, Pete, you old sod.