TRADING OF shares in UK-listed property group Real Estate Opportunities (REO), which is majority owned by Irish developer Treasury Holdings, was temporarily suspended yesterday at the company’s request.
This follows the appointment this week by the National Asset Management Agency of receivers to nine subsidiaries of the company after it called in its loans in relation to Treasury and a number of connected entities, including REO.
The REO subsidiaries affected by Nama’s action are: Wintertide Ltd; Radtip Properties Ltd (50 per cent owned); Tenderbrook Ltd; Sencode Ltd; Lornabay Ltd; Twynhold Ltd; Rigol Ltd (50 per cent owned); Ballymun Shopping Centre Ltd; and Coolred Ltd.
According to REO’s website, these companies, along with an entity called Montevetro II Ltd, owe Nama €568.8 million.
Treasury and 22 related companies are taking legal proceedings against Nama in relation to the appointment of the receivers.
A case will be heard in the High Court on February 21st, with four days set aside for the parties to make their arguments to the president of the High Court, Mr Justice Nicholas Kearns.
In a statement yesterday, REO said that, pending the court’s decision, it had undertaken to “co-operate” with the receivers.
It also stated that the receivers have undertaken to give 48 hours notice to Treasury before initiating any process of sale.
REO requested its shares be temporarily suspended pending the outcome of the High Court action.
PwC and Ernst & Young have been appointed as joint receivers to the Treasury properties.
These include sites in Spencer Dock in the Dublin Docklands area, including the PwC head office.
It is understood that E&Y will handle the Spencer Dock elements of the receivership.
This is one of the biggest moves by Nama against a debtor. Treasury is one of its 10 biggest clients.
The two sides dispute the value of loans associated with Nama.
The State agency places the face value figure at just under €2 billion, with it paying about €900 million to the banks on the transfer of the loans.
Treasury puts the figure at €1.5 billion, with Nama paying the banks between €500 million and €600 million.
The difference between the two sides is stated as being loans owed by Johnny Ronan, joint owner of Treasury, and entities not directly connected with the developer.
Treasury’s legal action argues that the receivers’ appointment makes no commercial sense.
The company claims the actions of Nama could have a domino effect within the group, threatening its survival in circumstances where it employs 300 people here and 100 outside Ireland.
REO has already ceded control of Battersea Power Station in London. Last month, Lloyds Bank and Nama received court approval to have Ernst & Young appointed as administrator to Battersea, which it acquired in 2006.
