Property tycoons to sue for €120m over losses

PROPERTY developers Johnny Ronan and Richard Barrett are suing Aberdeen Asset Management for up to €120 million.

Real Estate Opportunities (REO), an investment fund listed on the London Stock Exchange and majority-owned by the pair, said yesterday it was bringing legal proceedings against Aberdeen Asset Management and UBS over losses suffered by REO in a split capital investment portfolio.

The portfolio was managed by Aberdeen until April 2003, when REO terminated the contract over the mounting losses. When REO was set up in 2001, its income portfolio was valued at about €500m, but the value nearly halved under Aberdeen’s management.

“REO is seeking compensation for the substantial losses suffered by REO in its income portfolio, which was established by those advisers in June 2001,” REO said in a statement to the stock market.

Aberdeen said it had not yet been served legal proceedings “but continues to reject REO’s allegation as wholly without foundation and will be bringing a counterclaim against REO in due course.”

REO has returned strong profits in recent years as it now focuses purely on property. The company said it made €25.5m profits in 2004 and had investments and property valued at closed to €600m at the end of the year.