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IBRC Sale of Siteserv at €100 million loss.

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  • Registered Users Posts: 24 B2theT


    It kills me that I voted for Fg and Labour last time round and it sounded so genuine that they would change politics in this country but they they Do all the stupid things like water, can't they realize most people genuinely believe water should have some cost, but th ey won't pay now because of the beast and excessive cost it's become and that's before one pipe is fixed.. I've tried FF, then FG and Labour, only option now is the non-Looney independents and SF sure it couldn't get worse. And they deserve a go, everyone else has..


  • Registered Users Posts: 17,797 ✭✭✭✭hatrickpatrick


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

    Exactly!

    And this one sentence explains in one sentence what others including myself have attempted to explain in paragraphs upon paragraphs of analysis - the establishment in this country has destroyed our trust beyond all possibility of repair. They have, as the saying goes, "lost their jury".


  • Closed Accounts Posts: 5,191 ✭✭✭Eugene Norman


    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.

    That's an extremely weak deflection.


  • Registered Users Posts: 3,185 ✭✭✭Good loser


    And this one sentence explains in one sentence what others including myself have attempted to explain in paragraphs upon paragraphs of analysis - the establishment in this country has destroyed our trust beyond all possibility of repair. They have, as the saying goes, "lost their jury".

    So you're one of the 'pure of heart'!

    I'm just a practical sinner and will vote FG in 2016, if I'm around.

    Catherine Murphy is a longwindbag.


  • Registered Users Posts: 25,068 ✭✭✭✭My name is URL


    And this one sentence explains in one sentence what others including myself have attempted to explain in paragraphs upon paragraphs of analysis - the establishment in this country has destroyed our trust beyond all possibility of repair. They have, as the saying goes, "lost their jury".

    That's crazy talk! /s
    An Assistant Garda commissioner has claimed he was asked by Garda Commissioner Nóirín O’Sullivan during interviews for the position of deputy commissioner about his views on “left wing political extremism in Ireland” and on left wing politicians.

    http://www.irishtimes.com/news/crime-and-law/courts/high-court/garda-taken-aback-at-political-questions-in-job-interview-1.2186832


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  • Registered Users Posts: 17,797 ✭✭✭✭hatrickpatrick


    Good loser wrote: »
    So you're one of the 'pure of heart'!

    I'm just a practical sinner and will vote FG in 2016, if I'm around.

    Catherine Murphy is a longwindbag.

    Not entirely sure what you're trying to say with this post O_o
    If it's that you're happy to vote for the corrupt as long as they fix the economy, that's your prerogative. Personally, prosperity means nothing to me if I have to bring up my future children by telling them we don't live in a democracy in which there is nobody who is above the law and nobody who is given preferable treatment by the government.

    Some would undoubtedly regard me as foolish in this regard, personally I regard those who are willing to suffer endless scandals in exchange for a decent economy as foolish, just as I'm sure some would regard me as foolish for favouring less security over less privacy, while I would regard others as foolish for voting for those who promise safety as long as we let them access all of our emails, phone calls, etc.

    Personally I don't believe we have to make the choice between prosperity and an honest political system, and I regard it as quite sad that we've reached a point at which evidently some believe the two are mutually exclusive. I'm just saying if they were, personally I'd choose living in a decent, honest and fair society.

    But that's just me.


  • Closed Accounts Posts: 8,723 ✭✭✭nice_guy80


    Not entirely sure what you're trying to say with this post O_o
    If it's that you're happy to vote for the corrupt as long as they fix the economy, that's your prerogative. Personally, prosperity means nothing to me if I have to bring up my future children by telling them we don't live in a democracy in which there is nobody who is above the law and nobody who is given preferable treatment by the government.

    Some would undoubtedly regard me as foolish in this regard, personally I regard those who are willing to suffer endless scandals in exchange for a decent economy as foolish, just as I'm sure some would regard me as foolish for favouring less security over less privacy, while I would regard others as foolish for voting for those who promise safety as long as we let them access all of our emails, phone calls, etc.

    Personally I don't believe we have to make the choice between prosperity and an honest political system, and I regard it as quite sad that we've reached a point at which evidently some believe the two are mutually exclusive. I'm just saying if they were, personally I'd choose living in a decent, honest and fair society.

    But that's just me.

    Exactly

    Or that it is ok to fleece the public with more taxes, levies, and other crap while enriching certain people and businesses


  • Registered Users Posts: 13 julie385


    Good loser wrote: »
    I'm just a practical sinner and will vote FG in 2016, if I'm around.

    After all what's happened in recent years, you are still going to vote FF/FG?


  • Closed Accounts Posts: 9,244 ✭✭✭rrpc


    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?
    If the company collapsed then there would have been nothing to sell. I haven't seen their accounts, but as a service company they would have had very little in the way of assets; certainly nothing close to the eventual sales figure and the only other significant asset would have been their customer base which would have gone the minute it collapsed.

    That's what you get when you buy a company as a going concern; its customer base, its staff and its reputation. The minute you liquidate, that's all gone.


  • Registered Users Posts: 68,317 ✭✭✭✭seamus


    Yeah, I'm not sure there's anything majorly dodgy about the DOB link here. Like it or not he's a successful and shrewd businessman. No doubt he spotted that infrastructural outsourcing was the way the world was heading and had excellent contacts (and interests) in several companies who were looking to outsource their infrastructural teams. Not to mention water meters being imminently on the horizon.
    But he lacked a company who did that, and then was given a nudge about SiteServ - a company with a strong business history and an experienced workforce, just on the verge of collapse due to their debt burden.

    He sweeps in with an offer to allow IBRC take *some* cash out of the company (rather than see it collapse) and on he goes.

    It's not uncommon for takeovers/buyouts to include a sweetener for the shareholders, the major question here is why the shareholders had any say at all given the company's debt burden, who approved such an enormous sweetener amount (considering that's €5m out of the public purse), and who were the beneficiaries of this?


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  • Registered Users Posts: 19,617 ✭✭✭✭Muahahaha


    B2theT wrote: »
    It kills me that I voted for Fg and Labour last time round and it sounded so genuine that they would change politics in this country but they they Do all the stupid things like water, can't they realize most people genuinely believe water should have some cost, but th ey won't pay now because of the beast and excessive cost it's become and that's before one pipe is fixed.. I've tried FF, then FG and Labour, only option now is the non-Looney independents and SF sure it couldn't get worse. And they deserve a go, everyone else has..

    I'm in the same boat except I've never voted FF. At this stage I'd seriously consider voting SF purely becaause every other party has let me down and they're the only ones who I have. I dont agree with some SF policies but at this stage I see them as having more integrity that FF/FG/Lab put together. Perhaps thats because they're always in opposition but thats more to do with how badly FF/FG/Lab have done in govt than how good SF have done in opposition.


  • Closed Accounts Posts: 9,244 ✭✭✭rrpc


    seamus wrote: »
    Yeah, I'm not sure there's anything majorly dodgy about the DOB link here. Like it or not he's a successful and shrewd businessman. No doubt he spotted that infrastructural outsourcing was the way the world was heading and had excellent contacts (and interests) in several companies who were looking to outsource their infrastructural teams. Not to mention water meters being imminently on the horizon.
    But he lacked a company who did that, and then was given a nudge about SiteServ - a company with a strong business history and an experienced workforce, just on the verge of collapse due to their debt burden.

    He sweeps in with an offer to allow IBRC take *some* cash out of the company (rather than see it collapse) and on he goes.

    It's not uncommon for takeovers/buyouts to include a sweetener for the shareholders, the major question here is why the shareholders had any say at all given the company's debt burden, who approved such an enormous sweetener amount (considering that's €5m out of the public purse), and who were the beneficiaries of this?

    From what I've read and from people I've asked, the shareholder agreement was quite unusual and basically gave them a say in any sale. The beneficiaries are listed in the FOI documents (I think). The sale had to be voted on at an EGM and this was held and the motion to sell carried by almost 99%.

    I suspect given the number of different entities involved in the sale that there is unlikely to be anything untoward found in an investigation. It clearly was on its last legs (Walter Hobbs said it only had cash flow to run for another eight weeks beyond the sale date) and had to be sold quickly to get any value back for the bank.

    I'm assuming from the reports that the total loan value was €150 million, I'd be interested to know if there were any provisions against this in the IBRC accounts. In other words, had some of the loan already been written off or was the €150 million a written down value?


  • Registered Users Posts: 19,617 ✭✭✭✭Muahahaha


    seamus wrote: »
    Yeah, I'm not sure there's anything majorly dodgy about the DOB link here. Like it or not he's a successful and shrewd businessman. No doubt he spotted that infrastructural outsourcing was the way the world was heading and had excellent contacts (and interests) in several companies who were looking to outsource their infrastructural teams. Not to mention water meters being imminently on the horizon.
    But he lacked a company who did that, and then was given a nudge about SiteServ - a company with a strong business history and an experienced workforce, just on the verge of collapse due to their debt burden.

    He sweeps in with an offer to allow IBRC take *some* cash out of the company (rather than see it collapse) and on he goes.

    It's not uncommon for takeovers/buyouts to include a sweetener for the shareholders, the major question here is why the shareholders had any say at all given the company's debt burden, who approved such an enormous sweetener amount (considering that's €5m out of the public purse), and who were the beneficiaries of this?

    Its a fair point but what about the bidders offering more than DOB? FG/IBRC are trying to claim that these bidders had T&Cs attached whereas DOB didnt.
    The sale of Siteserve was a negotiation where the best price for the taxpayer was the objective. So why didnt IBRC go back to the French company and tell them that if they drop T&Cs then they're open to the €60m bid? Why just hand it over to the underbidder without trying to go back and get better terms from the other bidders? Surely thats what a negotiation is all about?


  • Closed Accounts Posts: 9,244 ✭✭✭rrpc


    Muahahaha wrote: »
    Its a fair point but what about the bidders offering more than DOB? FG/IBRC are trying to claim that these bidders had T&Cs attached whereas DOB didnt.
    The sale of Siteserve was a negotiation where the best price for the taxpayer was the objective. So why didnt IBRC go back to the French company and tell them that if they drop T&Cs then they're open to the €60m bid? Why just hand it over to the underbidder without trying to go back and get better terms from the other bidders? Surely thats what a negotiation is all about?

    Apparently the French bid was made after the closing date for bids (actually at the EGM to approve the sale). This is mentioned in the article I linked above. It also says that the French company wanted to do investigations as part of their bid that would take eight weeks and which would have meant the company would have been out of cash before it was completed (even if they'd been allowed jump in at the last minute). There were other bids that were close to DOB's but had strings attached that would have resulted in their price ending up lower.

    These are reports from the time of the sale, before it became the controversy it is now.


  • Registered Users Posts: 25,449 ✭✭✭✭Timberrrrrrrr


    Muahahaha wrote: »
    Its a fair point but what about the bidders offering more than DOB? FG/IBRC are trying to claim that these bidders had T&Cs attached whereas DOB didnt.
    The sale of Siteserve was a negotiation where the best price for the taxpayer was the objective. So why didnt IBRC go back to the French company and tell them that if they drop T&Cs then they're open to the €60m bid? Why just hand it over to the underbidder without trying to go back and get better terms from the other bidders? Surely thats what a negotiation is all about?

    Because the French bid wasn't binding
    "The board notes that the Altrad proposal is indicative, non-binding, governed by French law and conditional on an exclusivity period of eight weeks," Siteserv said in a statement.

    “The Altrad proposal is subject to due diligence and legal contract. Consequently, and having regard to these factors and the preliminary nature of the proposal, the Board's considered view is that there is no certainty that a legally binding offer at a price and conditions capable of recommendation to shareholders and stakeholders as a whole will emerge."

    So better to take 45 million now than MAYBE get 60 million 2 or 3 months down the line, meanwhile siteserve is losing money and hundreds of jobs are on the line.


  • Registered Users Posts: 19,617 ✭✭✭✭Muahahaha


    Because the French bid wasn't binding



    So better to take 45 million now than MAYBE get 60 million 2 or 3 months down the line, meanwhile siteserve is losing money and hundreds of jobs are on the line.

    But why not go back to the French company and say right we'll accept your €60m if you drop T&Cs and sign on the dotted line within 14 days? IBRC didn't do this whatsoever, making the bidding process seem like it was predetermined. I dont know anyone in business who would sell something and not try to bounce one bidder off the other to get a better deal, you see it over on Adverts all day long so why not the same level of negotiation for the Irish taxpayer ?


  • Closed Accounts Posts: 9,244 ✭✭✭rrpc


    So better to take 45 million now than MAYBE get 60 million 2 or 3 months down the line, meanwhile siteserve is losing money and hundreds of jobs are on the line.

    Indeed. And interestingly, what exactly did Altrad want?

    A couple of days later (after having threatened to make a complaint to the Competitions Authority) they withdrew it and instead made overtures to DOB to buy the UK arm of SiteServ.

    If that was their target all along, what chance of saving the Irish jobs, had they managed to buy SiteServ?


  • Registered Users Posts: 25,449 ✭✭✭✭Timberrrrrrrr


    Muahahaha wrote: »
    But why not go back to the French company and say right we'll accept your €60m if you drop T&Cs and sign on the dotted line within 14 days? IBRC didn't do this whatsoever, making the bidding process seem like it was predetermined. I dont know anyone in business who would sell something and not try to bounce one bidder off the other to get a better deal, you see it over on Adverts all day long so why not the same level of negotiation for the Irish taxpayer ?

    Because there is a time limit on the bid, If they had not sold when they did there was a chance that the French bid could fall through and then there is no buyer and a possibility that it could end up being sold for even less.


  • Closed Accounts Posts: 9,244 ✭✭✭rrpc


    Muahahaha wrote: »
    But why not go back to the French company and say right we'll accept your €60m if you drop T&Cs and sign on the dotted line within 14 days? IBRC didn't do this whatsoever, making the bidding process seem like it was predetermined. I dont know anyone in business who would sell something and not try to bounce one bidder off the other to get a better deal, you see it over on Adverts all day long so why not the same level of negotiation for the Irish taxpayer ?

    You get a very bad reputation when you do things like that. It's easy on adverts where you're selling one item, but a business that continually plays one bidder against another ends up with suppliers losing patience and agreeing amongst themselves to screw you.

    The Altrad bid could easily have been made purely to close the company down. Delay the sale and run it out of cash so you can pick up the pieces in a fire sale for a song. Or just pick off the customers as they are left looking for a new supplier.

    I'm not saying they were doing this, but there's always a suspicion about trade buyers (those in the same trade) just wanting the customer base and maybe some of the employees without having to spend anything.


  • Registered Users Posts: 8,577 ✭✭✭blackwhite


    Muahahaha wrote: »
    you see it over on Adverts all day long so why not the same level of negotiation for the Irish taxpayer ?

    Because haggling over selling a table on adverts is exactly the same as negotiating a multi-million euro sale with hundreds of jobs at stake.


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  • Technology & Internet Moderators Posts: 28,792 Mod ✭✭✭✭oscarBravo


    B2theT wrote: »
    ...sure it couldn't get worse.

    If there's one way to be consistently, reliably wrong, it's to announce that things couldn't be any worse than they are now.


  • Closed Accounts Posts: 7,964 ✭✭✭For Reals


    Not entirely sure what you're trying to say with this post O_o
    If it's that you're happy to vote for the corrupt as long as they fix the economy, that's your prerogative. Personally, prosperity means nothing to me if I have to bring up my future children by telling them we don't live in a democracy in which there is nobody who is above the law and nobody who is given preferable treatment by the government....

    ...and it's their definition of 'fixed'. You and I will possibly see an increase in minimum wage jobs and loans may be easier to access. That's what passes as a successful growing economy with these people, meanwhile they're making out like bandits on our coin. And yes I am blaming Enda 'time to change the system' Kenny, y'know, for doing nothing of the sort.

    As I always say, 'Trickle down effect my arse'.


  • Registered Users Posts: 19,617 ✭✭✭✭Muahahaha


    Because there is a time limit on the bid, If they had not sold when they did there was a chance that the French bid could fall through and then there is no buyer and a possibility that it could end up being sold for even less.


    Which is exactly my point. If the French said we need X weeks to complete then why not go back to them and say we have a lesser bid but they can complete in X weeks quicker so its the preferential bid. Now if you guys can speed things up then we'll consider your bid in a better light. Can you speed things up? Thats all they had to do to enable them to tick the box that says they tried to get the best deal for the taxpayer, its not much to ask, a quick phone call or email would have done it


  • Registered Users Posts: 19,617 ✭✭✭✭Muahahaha


    rrpc wrote: »
    You get a very bad reputation when you do things like that. It's easy on adverts where you're selling one item, but a business that continually plays one bidder against another ends up with suppliers losing patience and agreeing amongst themselves to screw you.

    The Altrad bid could easily have been made purely to close the company down. Delay the sale and run it out of cash so you can pick up the pieces in a fire sale for a song. Or just pick off the customers as they are left looking for a new supplier.

    I'm not saying they were doing this, but there's always a suspicion about trade buyers (those in the same trade) just wanting the customer base and maybe some of the employees without having to spend anything.

    It was IBRC and by extension the Irish taxpayer so reputations dont come into it. IBRC wont exist when everything is sold off. Besides they are selling distressed assets, people are after a bargain and so will jump to their tune.
    blackwhite wrote: »
    Because haggling over selling a table on adverts is exactly the same as negotiating a multi-million euro sale with hundreds of jobs at stake.

    Business is business regardless of whether youre selling a table or a portfolio of property. Haggling goes on at all levels of business, as the buyer wants the best price and so does the seller. Its no different here than it is on Adverts. Unless you can prove otherwise?


  • Closed Accounts Posts: 9,244 ✭✭✭rrpc


    Muahahaha wrote: »
    It was IBRC and by extension the Irish taxpayer so reputations dont come into it. IBRC wont exist when everything is sold off. Besides they are selling distressed assets, people are after a bargain and so will jump to their tune.
    But it wasn't IBRC who ran the sale, it was SiteServ who did. Granted they had oversight by IBRC and a plethora of advisors but the company sold itself.

    The reason for this is because it looks less like a fire damage sale and the company has all the industry contacts. It's quite normal and is done to get the best price.
    Muahahaha wrote: »
    Business is business regardless of whether youre selling a table or a portfolio of property. Haggling goes on at all levels of business, as the buyer wants the best price and so does the seller. Its no different here than it is on Adverts. Unless you can prove otherwise?
    Well there aren't too many examples of a bidding process with a defined start and end date being subverted by a last minute chevalier blanc riding in to overturn all the other bids. If there were, the courts would be cluttered with disgruntled bidders who went through the process only to be gazumped.

    But here's where I call shenanigans on the Altrad 'bid'. If they knew what the winning bid was (and they were present at the EGM that accepted it), why didn't they immediately go to DOB with their 60 million quid and offer him what they knew would be a hefty 33% return on his investment?

    No, instead they went to him and offered to buy the UK subsidiary instead; which you'd have to believe was all they were interested in in the first place.


  • Registered Users Posts: 68,317 ✭✭✭✭seamus


    Muahahaha wrote: »
    Which is exactly my point. If the French said we need X weeks to complete then why not go back to them and say we have a lesser bid but they can complete in X weeks quicker so its the preferential bid. Now if you guys can speed things up then we'll consider your bid in a better light. Can you speed things up? Thats all they had to do to enable them to tick the box that says they tried to get the best deal for the taxpayer, its not much to ask, a quick phone call or email would have done it
    That's why you put a time limit on these things. At the higher end you need to arrange board meetings and consultations to nail this stuff down. It's not two guys in DelBoy coats haggling. So the time limit for bids sets out what's expected and if you don't meet it, you're excluded.

    Offers outside of the time limit are often notified to the board, but unless there are extremely strong circumstances to consider it, it will usually be rejected.

    I'm going through the housebuying process, so this is somewhat close to my heart at present; you don't accept the offer that's the highest, you accept the best proposal. So someone who offers less but can sign contracts today and close the sale next week is a far better choice than a higher offer who still has to go to the bank and apply for a loan and may or may not be able to close the deal in 6-8 weeks.


  • Registered Users Posts: 17,797 ✭✭✭✭hatrickpatrick


    oscarBravo wrote: »
    If there's one way to be consistently, reliably wrong, it's to announce that things couldn't be any worse than they are now.

    Indeed. I made this mistake when I voted for FG and Labour in 2011 to try and kill FF's presence in the next Dail. I certainly won't be making it again.


  • Closed Accounts Posts: 9,244 ✭✭✭rrpc


    Indeed. I made this mistake when I voted for FG and Labour in 2011 to try and kill FF's presence in the next Dail. I certainly won't be making it again.

    I suspect you're about to make the same mistake again and for the same reasons ;)


  • Registered Users Posts: 8,577 ✭✭✭blackwhite


    Muahahaha wrote: »
    Business is business regardless of whether youre selling a table or a portfolio of property. Haggling goes on at all levels of business, as the buyer wants the best price and so does the seller. Its no different here than it is on Adverts. Unless you can prove otherwise?

    TBH - all this post shows is how little you know about the topic under discussion.

    One simple difference:
    If I'm selling a table on adverts, then there's not much chance of 2000 employees being less jobless if I sell it to someone who wants to break up the table and re-sell it for firewood.


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  • Registered Users Posts: 8,577 ✭✭✭blackwhite


    rrpc wrote: »
    I suspect you're about to make the same mistake again and for the same reasons ;)

    Keep voting for someone new because they can't deliver the sun and the stars - sounds like the Irish electorate TBH :D


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