Treasury Holdings’ co-founder Richard Barrett will get €5m cash “with no strings attached” under a proposed settlement of a legal action brought against him and co-founder John Ronan over a controversial €20m transaction, a High Court judge has noted.
That was “a lot of money for a defendant against whom there is an allegation of fraud”, Mr Justice Peter Kelly said at the commercial court. The €5m, he was told, included a €4.8m “success fee” for Mr Barrett related to agreements on disposal of various shareholdings held by him.
Mr Ronan is expected, arising from his proposed retention of a shareholding in Treasury Asian Investments Ltd, to get a similar sum under the complex settlement put before the court for approval yesterday, by the official liquidators of the company and the National Assets Management Agency, Treasury’s largest creditor.
NAMA is owed an estimated €1bn by the insolvent developer, having acquired that amount of its €2.7bn loans in 2011.
The proposed settlement of the case over the Treasury Asian Investments transaction, involving the alleged disposal of a significant asset of Treasury at a significant undervaluing, was reached after lengthy negotiations and would bring €47m into the liquidation, Rossa Fanning, for the liquidators, said.
The liquidators, the company and Nama are all plaintiffs in the action against Mr Ronan and Mr Barrett over the Treasury Asian Investments transaction of March 22 2010, where €20m shares were allegedly transferred out of the group to the benefit of Mr Barrett and Mr Ronan for €100,000 and unsecured loan notes. Treasury was initially also a defendant but, after it was wound up, became a plaintiff.
The plaintiffs claim there was no commercially valid reason for the Treasury Asian Investments transaction made when Treasury was either insolvent or in very difficult financial circumstances. The claims are denied and the case was listed for hearing in October.
Yesterday, Mr Fanning said the liquidators believe the proposed settlement would realise more for the liquidation than a victory in the action. The agreement addressed not just the Treasury Asian Investments transaction but also addressed another transaction, he added.
Counsel was referring to the Manco transaction, alleged by Michael McAteer, one of the official liquidators, to be linked to the Treasury Asian Investments transaction, and involving a sum of €2.26m.
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