Court fast-tracks Kentech group dispute

A BITTER dispute between some directors and shareholders of the giant Kentech group, which employs 2,800 people in Ireland and worldwide in providing engineering and other services, has come before the Commercial Court.

John Murphy, a director with a shareholding of more than 20%, has brought a petition alleging the affairs of Josar Holdings Ltd, the holding company in the Kentech group with registered offices at Little Island, Co Cork, and the powers of some directors are being conducted in an unfair, oppressive and unlawful manner.

In his petition, brought under Section 205 of the Companies Act, he claims his employment with the company was terminated last March in breach of a shareholders agreement and he is also seeking orders for the purchase of his shares.

The respondents are four directors: Michael Francis Kent, the founder of the company, Sarah Kent, who has been chief executive since 2008, John Kent and John Gilley.

In a lengthy affidavit, Mr Murphy, of Coach Hill, Rochestown, Co Cork, makes a series of claims about the operation of the company and claims Sarah Kent conceived the termination of his employment as a “coercive negotiating tactic” aimed at achieving the “greater end” of his elimination as a shareholder and to prevail upon him to sell his shares at an undervalue.

Mr Murphy claims Ms Kent emailed him on March 7 stating he had been disabled from the company’s network and email systems and she was terminating his services because he had told her he believed Bank of Ireland had sought to grasp the Kent family shareholding in Kentech and the shares “were quite likely to end up in NAMA if that happened”.

Ms Kent had accused him of defamation and gross insubordination for making that statement but he fully stood by it, he said.

The case was fast-tracked this week into the Commercial Court by Mr Justice Peter Kelly who said it involved a bitter dispute. He has given the sides two weeks to consider a possible mediation rather than “a battle royal in court”.

Mr Murphy, who has been involved with the group since it was founded in 1994 by Michael Francis Kent, said in his affidavit he believes the allegedly “perilous state of finances” of the Kent family and their own personal financial interests are taking precedence over the interests of the company which had a $141 million (€99m) turnover last year.

In an affidavit, Sarah Kent denied the claims.

While accepting that the Marlfield property development project of John Kent and Michael Francis Kent had failed in 2008 with a significant sum owed to Bank of Ireland, that debt was “entirely unrelated” to the company, she said.

Under the company shareholders agreement, shareholders are prohibited from the giving of security over their shares except in certain limited circumstances and neither John Kent nor Michael Francis Kent had sought that approval, she said. Bank of Ireland has no lien over their shares, she added.

Ms Kent also said she emphatically rejected the affairs of the company were being run unfairly or oppressively and denied the various claims by Mr Murphy concerning his treatment and employment.

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