Seismic, but not surprising

SEAN QUINN’S decision to apply for voluntary bankruptcy at the high Court in Belfast is a seismic event, but not a great surprise.

Quinn has fallen a long way since the heady days of the boom, when it was reckoned that he and his family had a net worth of €4.5bn, with around eight thousand people employed worldwide. He was viewed as Ireland’s richest person.

Since then, his fortunes have changed for the worse.

The noose around his empire has been tightened, notch by notch, since the businessman and his family amassed around one quarter of the shares in Anglo Irish Bank, using highly risky contracts for difference. At their peak, those shares were worth over €3bn.

The following year, the Anglo share price went into freefall — a development which pushed the state into an open-ended guarantee of the country’s banks, which ultimately proved disastrous.

By January 2009, the bank had been nationalised. A new board was put in place and Quinn’s shares in Anglo were worthless.

Quinn was left vulnerable following his strategic error which, ironically, may have been driven by a desire to provide an underpinning for his huge property, building products and insurance empire, which extended as far as Russia.

In March 2010, Quinn Insurance, viewed as the Quinn empire’s cash cow, was put into administration amid growing concern about the quality of business the company was writing, particularly in Britain.

The move sparked a fury in the border counties, in particular, understandably highly concerned about the possible threat to their jobs.

Quinn and his supporters maintained that the move sealed the fate of his business empire as a whole.

Quinn insisted that the group could produce profits of €400m to €500m over the following three years, assuming the insurance business was retained in his hands. This was not to be.

Bad blood remains, with attacks on vehicles owned by executives brought in to run Quinn Insurance

Receivers have since been appointed to the rest of the Quinn empire, prompting the Quinn family to launch a legal rearguard action aimed at establishing that Anglo Irish Bank acted wrongfully in its dealings with them and seeking to overturn the receiverships appointed by the Bank.

The man himself is a complex, taciturn figure, a family man who trades on his ordinariness.

One of his main pleasures is a card game held with old buddies every Tuesday.

While Quinn retains huge local loyalty, this runs side by side with resentment even locally at how his gambles have impacted on ordinary peoples’ lives.

Across Ireland, there would be less sympathy for a man who looks set to cost Irish policyholders dearly over the next decade.

He is viewed as a border counties businessman who became the most extreme example of Celtic Tiger business bravado — though in Quinn’s case, he sought to cover his ambition under a countryman’s veneer.

Business practices at Quinn Insurance came under some scrutiny among consumers. Quinn quoted competitively, but the view was that claims could be hotly contested and some claimants would emerge feeling intimidated.

To those who have dealt with him professionally, Sean Quinn is viewed as a tough cookie.

The man amassed his wealth through hard graft, ingenuity and native cunning. In the border area, the Quinn Group provided employment to thousands of people.

A onetime Fermanagh county footballer, he started out in business back in 1973, running a gravel business.

In the early years, Sean worked closely with his brother, Peter&, in building up the business, expanding into building supplies.

During the 1970s, he began producing concrete, in competition with CRH. In the 1980s, he went national, opening plants in Fermanagh and Galway.

In the 1990s, the Group moved into insulation products, set up Quinn Glass and in 1995, set up Ireland’s first wind farms.

In 1996, Quinn established Quinn Life, a general insurer, intending to shake up the market.

In 2007, he acquired the Irish health insurers B, and announced plans to open a facility in Cork the following year.

Now the Quinn empire has been dismantled, but Quinn himself is not going down without a fight.

The bankruptcy regime in the North is far less onerous than in this jurisdiction. Unlike in the Republic, there is an automatic right of discharge from bankruptcy in the absence of proof of non-co-operation and non-disclosure of assets.

Quinn no doubt reckons he could emerge from the process before too long. Meanwhile, he is fighting a public relations war.

In a statement, Quinn acknowledges a degree of personal culpability, but is scathing about Anglo Irish Bank and the Government.

He “strenuously disputes” the vast majority of the debt owed. He paints the bank as responsible for his financial predicament and argues that the bank and the Government have “made scapegoats” of him and his family. He insists that the group, prior to its takeover by Anglo, was “highly profitable”.

Quinn is almost unique among the fallen barons of Irish business in seeking to use populism as a means of buttressing his position.

At the same time, the family is taking on Anglo in the courts, with a major confrontation set for next spring in the High Court.

There are a few chapters left in the Sean Quinn story. Perhaps he believes that he can recover. It seems implausible — but you never know...