IBRC buys out Russian debt collectors

IBRC’s special liquidators have bought out its partner in the controversial joint-venture it established nearly three years ago to recover key Quinn family assets in Russia and Ukraine, for $34m (€31m).

The former Anglo Irish Bank and Irish Nationwide Building Society entered into a joint venture with Russian investment firm A1 in late 2012 in a bid to regain control of Quinn assets beyond the reach of the State; particularly those in Russia and Ukraine.

Since then, A1 has recovered several key property assets, including the Kutuzoff Tower, an office development in Moscow.

The company has a one- third stake in the joint venture, with IBRC controlling the remaining two thirds. The two had planned to sell the assets upon retrieval.

While A1 wanted to sell immediately, IBRC wanted to hold off on a sale due to unrest in the region lowering the value of the rouble and Ukraine’s currency, the hryvnia, as well as of the assets themselves.

The combined secured assets are now worth around $120m; compared to an estimated upper value of around $200m in 2013. The assets include Q Park, a major logistics facility in Kazan and the Univermag Shopping Centre in Kiev.

The four assets are seen as the key Quinn properties in the region. However, it is understood there are another eight smaller value assets still out of reach in Russia. IBRC’s liquidators yesterday announced a revision to the agreement with A1, that sees it take full control of the recovered main assets by buying A1 out of the joint-venture.

However, A1 will continue work to retrieve the remaining assets and will earn 20% commission on the value of any further assets recovered over the next six months.

Speaking yesterday, IBRC joint special liquidator Kieran Wallace said it remained committed to recovering all outstanding assets, but this amendment to the agreement makes sense at this time.

“A1 has done an excellent job of securing these assets where all prior efforts of the bank had failed. The joint-venture approach has worked well.

“The revision makes commercial sense at this juncture as it is in the best interests of the State that these assets are not sold now, at seriously depressed prices.”