THE PROVISIONAL administrators of Quinn Insurance have received about 20 inquiries from groups interested in buying all or part of the company’s business.
The expressions of interest came as Quinn Group increased its opposition to last Tuesday’s appointment of the administrators by the Financial Regulator, raising questions about how the move will affect Quinn’s ability to repay its debts to Anglo Irish Bank.
Liam McCaffrey, chief executive of the group, said Quinn Insurance was key to the Quinn family’s ability to repay the €2.8 billion it owes to State-owned Anglo Irish. Mr McCaffrey said a “very robust” Quinn Insurance would have been needed for the debt to be repaid, “either through cashflow or disposal”.
This was “made much more difficult through the action of Tuesday”, he added.
Seán Quinn, the founder of the company, said last night the administration move was one of the worst decisions in Irish corporate history. He said it had placed the jobs of Quinn Group’s 5,500 Irish employees in jeopardy.
Mr Quinn confirmed for the first time that his family had lost €3 billion in shares in the last three years. He said the media had thought it was about €1-1.5 billion. “Well I can tell them it was three,” he said.
Mr Quinn said “we owe Anglo €2.8 billion”, but “we had a plan to reduce that borrowing by €400 million in the next three years.’’
Speaking to RTÉ news he said he was making “€400 million or €500 million a year profit, we had no problem in the world paying that back to them.”
Meanwhile, the administrators Grant Thornton have told those interested in Quinn Insurance’s assets, it is “premature” to consider a sale at this point.
“If we decide to sell all or any part of the business in the future, we shall contact you to ascertain whether you wish to participate in the sales process,” they said.
The appointment was made on the back of regulatory concerns over Quinn Insurance’s solvency, or the excess of its assets over its liabilities. The concerns arose after the regulator became aware of guarantees made by subsidiaries of Quinn Insurance regarding €1.2 billion in Quinn Group borrowings.
This debt is in addition to the monies the Quinn family owes.
Quinn argues these concerns are unfounded because there is no prospect of the group debt being called in by its lenders. “This could have been resolved given time, and not very much time,” said Mr McCaffrey.
It has also emerged that Anglo Irish consulted Minister for Finance Brian Lenihan on the bank’s plan to cut its “significant” exposure to the Quinn family.
Anglo chief executive Mike Aynsley wrote to Mr Quinn in February, saying he would discuss with Mr Lenihan, the bank's shareholder as Minister for Finance, a proposal by Mr Quinn to reduce his family's debts, according to a letter seen by The Irish Times.
Under the relationship agreement between the bank and the Minister, Anglo is run on a commercial basis at arm’s length from the Government with the commercial relationship between Anglo and its customers left to the bank.
The Minister can, however, intervene to protect the public interest or ensure the bank is following the business plan that complies with the Minister’s objectives.
Separately, The Irish Timeshas confirmed that Anglo's new management team has retained specialist forensic investigators to determine whether former senior managers have concealed or undeclared assets.
Meanwhile, some 300 Quinn staff yesterday protested outside the Dáil, calling on the Government to protect the company’s jobs.
The administrator’s appointment remains provisional until a further court hearing on April 12th. At that stage Quinn Insurance can oppose it.
