The State and AIB have asked the High Court to strike out an application aimed at preventing the sale of the government's shareholding in the bank.
Vincent O’Donoghue, a businessman, with an address at Church Street, Dublin 7, has brought the application, claiming the proposed sale is contrary to the common good and is unlawful.
Mr O’Donoghue’s case is against AIB Plc, the Minister for Finance, Ireland and the Attorney General. Prior to any full hearing, he wants injunctions preventing the Government taking any steps to dispose all or any parts of the State’s shareholding in AIB.
In a sworn statement, he refers to AIB’s “long and sorry history of catastrophic governance failures”. Those demonstrate the bank is “incapable of operating in a lawful, responsible and complaint manner”, he says.
Alleged failures
Among examples of the alleged failures before the 2009 €21.8 billion bailout of AIB, he said the State had to bail out an AIB subsidiary, ICI in the 1980s and he also referred to rogue trader John Rusnak and to Dirt tax evasion. If it is returned to private ownership, AIB will "only serve one master" and have the sole focus of "relentlessly pursuing profits" for mostly foreign shareholders, he says.
AIB and the State parties oppose his case and have brought motions aimed at having the entire proceedings struck out on grounds including it is allegedly vexatious, frivolous and bound to fail.
The matter was briefly mentioned before the court on Wednesday afternoon when lawyers for the State and AIB asked Mr Justice Paul Gilligan to bring forward the hearing of the application for an injunction to Friday.
Patrick McCann SC, for the Minister for Finance, said there was some urgency in the matter. While no timetable or exact date to sell the shares has been set, preparations for an initial public offering (IPO) on the Irish and London stockmarkets have been underway for some time, counsel said.
A possible narrow window when the State might get maximum value for the shares, based on factors including stock market stability, had been identified for late May/early June, counsel added.
The mere existence of injunction proceedings in relation to the possible IPO could have an adverse impact and could damage potential investor confidence in an IPO, counsel said. The application to move the hearing forward was supported by AIB, represented by Denis McDonald SC.
Representing himself, Mr O’Donoghue objected to the Friday proposal. He said a date had been fixed next Tuesday to hear the injunction application and he disputed the matter was so urgent it needed to be heard this week.
The court should take account of the fact the Government’s decision to sell shares was defeated in a recent vote in the Dáil, but it planned to go ahead with the sale regardless, he said.
The government has also been disrespectful to the judiciary, he added.
Mr Justice Gilligan said a lot of time and expense has gone into the preparation for the possible sale of the State stake in AIB and he would hear the matter on Friday.
