IBRC Sale of Siteserv at €100 million loss.

nice_guy80

What is going on here then?

Siteserv was sold by tax payer owned IBRC to a company owned by Mr Denis O'Brien for a loss of €100 million to the taxpayer, based on the debts that Siteserv owed.
The minister for finance apparently knew nothing of this large deal/loss at the time.
http://www.rte.ie/news/2015/0422/695828-siteserv/

The IRBC at the time was headed by Mr Alan Dukes (former FG minister)
Mr O'Brien, who is a well known supporter of Fine Gael (see mobile phone licences and former FG minister Michael Lowry) bought the company for a steal.

Siteserv then went on to get a lucrative major infrastructure contract, through it's subsidary Sierra, from Irish Water, set up by Fine Gael ministers.

It all looks a bit dodgy to me.
As a taxpayer I'd like to know why Siteserv can have €100 million of debt written off by a state owned bank but yet most state owned banks are chasing down families for a few hundred thousand euro owed on their houses.

Sierra Oscar

Very strange that the shareholders also got a €5 million payout as part of the deal even though the company was rapidly going under. Also the same legal representative acted for both the seller and the purchasers. Is that even legal? Seems like a massive conflict of interest.

washman3

Basically, Fine Gael have given Denis O'Brien a €100 million gift courtesy of the Irish taxpayer.
The usual Blueshirt apologists will be along here shortly.!

mada999

wow no comments on this by the regular blueshirt defenders on boards, seems very strange too ?

td2008

This story from a few years ago makes sense all of a sudden :rolleyes:

http://www.independent.ie/business/irish/siemens-cheaper-water-meter-offer-snubbed-by-minister-hogan-26845507.html

FreudianSlippers

I think we have to hear from the board as well. Something isn't right here, but I'm not prepared to jump to conclusions unless the board is also stacked with FG members.

I'm also not going for the red herring in the OP of comparing bailed out companies with hope repossessions. I do think we should fully investigate the transaction and if DOB is making a profit from this company, surely the government would have found a way to claw-back the €100m loss.

blackwhite

TBH - the DOB link looks more and more like a red herring at this stage - the real question is who were the original shareholders, and how did they manage to get such a good deal.

The €100m "loss" was loans that SiteServ had run up prior to being taken over by IBRC.
To have any hope of finding any buyer - not just DOB - there was going to have to be a significant restructuring of the loans.

The key point that I can't understand is why, when such a restructuring was needed, was receivership or some similar strategy not followed whereby the entire proceeds of the sale to DOB or any other potential investor would flow to the creditors (i.e. IBRC and, by extension, the Irish people), instead of €5m being funneled to the original shareholders.

Chips Lovell

IBRC still has to sign off on the haircut for the deal to go through. Presumably it agreed to the shareholders getting €5 million in order to incentivise them to OK the sale.

IBRC didn't comment at the time on why it chose this route over altneratives such as receivership:

While IBRC declined to comment on the transaction, it is understood that a sale was seen as the best alternative to the bank versus other options for getting some return back on its loan.

golfball37

The real question is how did GMC Sierra win the contract for water meter instillaation when they submitted their tender 3 weeks after the closing date?

Was it a calculated business gamble* by DOB to buy Siteserve like it was to buy Esat back in the day.

* Sniggers

Chips Lovell

Source?

Skrynesaver

GMC/Sierra was registered as a company on 15 July 2013 – The closing date for bids was 30th of June...

Not sure about the tender submission date, but as the entity didn't exist at the submission closing date there is a bit of a whiff of stitch up about it.

Chips Lovell

It was a JV. The entity didn't have to exit prior to submission of tender.

Under EU procurement rules, it is not permissible to require groups of economic operators, bidding together as a consortium, to assume a specific legal form before a tender is awarded.

FreudianSlippers

It doesn't make sense for what is effectively a SPV to exist before a tender.

Big C

I can't believe anybody is surprised by the crooks running this sh*t hole

Streetwalker

This is unravelling fast for the government. Joan Burton digging the hole deeper and deeper.

FreudianSlippers

Joan Burton's statements are successfully defending FG on the subject and seemingly shifting the blame to Labour. Did she forget which party she's the leader of?

uck51js9zml2yt

Big C wrote: »

I can't believe anybody is surprised by the crooks running this sh*t hole

Lets not foget who dug the hole in the first place.!!!

Since its not been said ( and is expected).... Its a conspiracy to tarnish FG by those who led the country into owing billions and a group of murders and tax / prsi dodgers.:)


But seriously.. It leaves a lot of questions to be answered by Dukes and Noonan....any maybe MLMD can name some names under privilege for the hell of it.

jimmycrackcorm

washman3 wrote:

Basically, Fine Gael have given Denis O'Brien a €100 million gift courtesy of the Irish taxpayer. The usual Blueshirt apologists will be along here shortly.!

Fine Gael are also responsible for Murdoch selling MySpace at a loss. Bought for $580m and sold for $35m. Sure there must be connection because both Murdoch and Denis O'Brien have something to do with newspapers.

hfallada

There was always going to be a write down. However the level of a write down was going to be important. The fact another company had an offer for Siteserv of €60, meant the write down could have only been €90 million (or 85 Million if the shareholders didnt get anything)

I think there needs to a brief enquiry about this. To ensure it doesn't happen again to the remainder of any state owned banks assets. But the last thing we need is another Moriarty tribunal running on for years, costing tens of million to actually achieve nothing. Tribunals in this country is just lip service and a great way to line a few solicitors/barristers pockets.

I do believe Irish people currently have an unhealthy obsession with the use of Isle of Man companies. Most large companies in the last decade have a IoM connection to create secrecy eg all bin companies, construction companies, luxury houses being bought by IoM companies.

Muahahaha

golfball37 wrote: »

The real question is how did GMC Sierra win the contract for water meter instillaation when they submitted their tender 3 weeks after the closing date?

Was it a calculated business gamble* by DOB to buy Siteserve like it was to buy Esat back in the day.

* Sniggers

not only that but around the same time the GMC Sierra website 'About Us' webpage got updated to state that they had expertise in the installation of water meters, despite no mention of it before the sale to Denis O'Brien

laugh

This guy is very shifty.

Baggy Trousers

laugh wrote: »

This guy is very shifty.

Extremely! His eyes are all over the shop. His body language is deceptive.

ABlur

Baggy Trousers wrote: »

Extremely! His eyes are all over the shop. His body language is deceptive.

Missed the beginning, who is he??

Baggy Trousers

ABlur wrote: »

Missed the beginning, who is he??

Independent expert involved in the sale: Walter Hobbs

K-9

washman3 wrote: »

Basically, Fine Gael have given Denis O'Brien a €100 million gift courtesy of the Irish taxpayer.
The usual Blueshirt apologists will be along here shortly.!

mada999 wrote: »

wow no comments on this by the regular blueshirt defenders on boards, seems very strange too ?

Mod: If people want to get their retaliation in first the politics cafe might be more your thing, we expect a higher standard here. It's pretty basic really, try and add something to the thread other than just personalising it and making digs.

laugh wrote: »

This guy is very shifty.

Baggy Trousers wrote: »

Extremely! His eyes are all over the shop. His body language is deceptive.

As above.

Streetwalker

This is unravelling fast for FG.

hatrickpatrick

laugh wrote: »

This guy is very shifty.

Shifty indeed. He didn't strike me as a crook or anything, more like someone who's been blindsided and may not have been aware of all the facts when this was happening. Either way though his remarks will only further the crisis - on the shareholders, he effectively stated that they shouldn't have been paid, but that they had to be bribed to accept the deal.

This makes little sense to me - if the deal hadn't worked out, as he said himself, the company would have collapsed anyway and the shareholders would have got nothing. So what vested interest would they have had in blocking it? Taking the ship down with them or something?

I had the RTE player paused (was already recording two programs on TV) and apparently if you pause for too long the next program begins regardless of whether you've finished watching what you had paused, so I didn't get to see any of the reactions to his interview apart from the very beginning of Catherine Murphy's response in which she said she'd be even more concerned having just watched that interview. Did anyone see the rest of the show? What else did she say and did anyone else speak on it?

For Reals

Look, when both Kenny and Noonan state they knew nothing about it from the get go, you just know it's going to be a shame on all involved, but of course no laws will be found to have been broken.
Noonan sold himself as a fiscal watchdog pre-election now he's bringing in changes to ensure he's told what's going on in the future...after the horse?
Nothing will come of this. No jail, no fines, no savings for tax payers. It'll be another earner for some legal folks.

As a person who helped get them in, I'm disgusted and feel fooled, once again.

michael999999

For Reals wrote: »

Look, when both Kenny and Noonan state they knew nothing about it from the get go, you just know it's going to be a shame on all involved, but of course no laws will be found to have been broken.
Noonan sold himself as a fiscal watchdog pre-election now he's bringing in changes to ensure he's told what's going on in the future...after the horse?
Nothing will come of this. No jail, no fines, no savings for tax payers. It'll be another earner for some legal folks.

As a person who helped get them in, I'm disgusted and feel fooled, once again.

Remember what happened to the fine Gael heads involved in the Rehab scandal?

Exactly!

B2theT

I am genuinely concerned when it comes to Dennis, he controls topaz, large parts of the news paper he owns radio stations, has a large construction firm winning handsome contacts, and can pump vast money into things like the FAI ..Got away with the hike mobile licence thing... is this just a outstanding business man or does he just always seem to be in the know and happen to always land's on his feet..

michael999999

B2theT wrote: »

I am genuinely concerned when it comes to Dennis, he controls topaz, large parts of the news paper he owns radio stations, has a large construction firm winning handsome contacts, and can pump vast money into things like the FAI ..Got away with the hike mobile licence thing... is this just a outstanding business man or does he just always seem to be in the know and happen to always land's on his feet..

Coincidence hes fine Gaels largest financial backer!