Lawyers for the bank told the High Court yesterday that it made a demand for the payment of €30m on the developers and 15 related companies which it claims it is owed arising out of loans advanced for the development of the Spencer Dock project in Dublin.
Due to the firm’s alleged failure to satisfy the demand, the bank claims the firms are insolvent and unable to pay its dues.
KBC have petitioned the court to have Treasury and the related companies wound up and insolvency practioner David Carson of Deloitte appointed as liquidator to the firms.
The companies, all with a registered address at Connaught House, 1 Burlington Rd, Dublin 4, have opposed KBC’s applications on grounds including that Treasury is in talks aimed at securing new investment to cover the loans.
As well as Treasury Holdings itself, KBC is further seeking to have related companies, including Spencer Dock National Convention Centre Hotel, Spencer Dock Development Company, Faxgore Ltd, Querida Ireland Holdings Ltd, and Robheat Ltd, wound up.
Mr Justice John Hedigan agreed to adjourn the bank’s petition to the end of the month to allow for the exchange of affidavits and submissions between the parties. The judge said the matter will go ahead on Aug 27, subject to a judge being available. The hearing is estimated to last for half a day. Nama will be a notice party to the application.
Lyndon MacCann, counsel for KBC, said his client was part of a banking syndicate that extended loans of €270m to Treasury Holdings and related companies for the development of the Spencer Dock.
KBC, he said, provided 25% of the total amount borrowed. Mr MacCann said that KBC was seeking recovery of what were “undoubtedly overdue loans.”
However, the companies had sent replying affidavits late in the day which raised defences against the petitions, including that there were new investors in the wings who were going to take out Treasury’s loans to the syndicate.
It is also argued that the petitions are invalid because KBC is a minority party in the banking syndicate. The petitions could only be moved by the agent of the majority holder in the syndicate, it is also claimed.
Counsel said that KBC would be contesting these points which he said were “delaying tactics designed to frustrate our [KBC’s] legal entitlements”. Mr MacCann added that, from the bank’s point of view, the concept that there was a “new investment proposal in the nebulous” had “no merit”.
Ross Gorman, counsel for Treasury, said his clients disputed KBC’s summary to the court. Treasury is in talks aimed at securing new investment. It also argues that it is all parties best interest, including the firms 300 employees, that the firms are not wound up.