O’Flynn developers: Examiner move was improper
The brothers are challenging the appointment last week of an interim examiner to their four key companies — O’Flynn Construction Company; O’Flynn Construction BTC; O’Flynn Construction (Rochestown); and Eastgate Developments (Cork) — on the grounds that they were insolvent.
Michael Cush, counsel for the O’Flynns, told the court yesterday that the application for examinership on behalf of Carbon Finance Ltd, a Dublin-registered affiliate of Blackstone, was part of the US company’s objective to gain control of the O’Flynn Group, particularly its valuable assets.
Mr Cush said the O’Flynn companies were seeking to dismiss the interim examiner, which they believed was part of an improper attempt by Blackstone to take over the O’Flynn Group.
Mr Cush said that what was really at the heart of the Carbon petition had been the removal of the principal shareholders in the O’Flynn companies, who were also challenging demands made of them last Tuesday for theimmediate repayment of personal loans amounting to around €16m.
He said the O’Flynns claim their loans were not in default and that they had not been given reasonable time to repay them.
Shortly after a demand for immediate payment had been made, Carbon Finance had appointed receivers to the companies and purported to appoint new directors to them.
“We say that, from the beginning, it has been Carbon’s objective to gain control of the companies and more particularly their valuable assets and cashflow,” said Mr Cush.
Blackstone had bought around €1.8bn loans from Nama for which the O’Flynn companies had provided guarantees and had attempted to trigger a loan default, calculated to cause cash flow difficulties, as one of the ways of going about their overall objective.
He said the O’Flynn companies’ business relationship with Nama had worked well for four years, while, within six weeks of the beginning of their relationship with Carbon Finance, that company had been planning examinership.
Mr Cush said Carbon Finance had camouflaged its true intentions by wrongful allegations of co-operation with the O’Flynn companies, which had led to a breakdown in trust engineered by Carbon.
He told Judge Irvine it was the O’Flynn companies’ contention that Carbon had been guilty of the most extraordinary non-disclosure of information to the High Court and of very serious mischaracterisation of the actual situation.
A wholly misleading statement had been made to the court that no proposals had been forthcoming from the personal shareholders of the O’Flynn companies.
Mr Cush said the protection of the court had not been necessary for a write-down of secured debt or to facilitate investment in the Cork group of companies.
The Blackstone side of the legal dispute will be heard in court today.
CONNECT WITH US TODAY
Be the first to know the latest news and updates
