A Co Fermanagh company that played a key role in the Quinn family’s foreign property portfolio, has recognised losses of £117.9 million (€138.9 million) associated with the family’s former properties in Russia and the Ukraine.
The company, Demesne Investments Ltd, based in Derrylinn, Co Fermanagh, was owed approximately £143 million by property companies in Russia and Ukraine, but it appears to have recognised that most of this has been lost.
The company is now under the control of the State-owned Irish Bank Resolution Corporation (IBRC), which had security over the Quinn family's foreign property portfolio.
Offshore companies
Huge debts owed to the Derrylinn company by the foreign property holding companies, were transferred to offshore companies during the family's efforts to move the properties beyond the reach of the State-owned bank (which is now in liquidation).
The movement of the right to the debts to the offshore companies was subsequently rendered void by the High Court in Belfast. However the IBRC and its agents have had difficulties asserting rights in Moscow and Kiev.
The IBRC has since concluded a deal with an Russian asset recovery group, A1, which is trying to seek to recover former Quinn assets in Russia and the Ukraine over which the IBRC is asserting security, so as to share any proceeds.
Accounts just filed by Demesne detail how, as part of the deal, A1 advanced $18 million, by way of a preferred loan, to a new company, QIPG Refinance Ltd, which is now owned by IBRC and A1.
Debts transferred
The money was used to pay Demesne for debts of $18 million it transferred to QIPG. The $18 million figure is described as the current market value of the debts due to Demesne, and the transaction crystallised a loss of £117.9 million. Because a provision of £132.6 million had been made in the accounts, the profit and loss account for Demesne for 2012 shows a profit of £12.6 million.
The accounts show a loss of £2.1 million arising from the revaluation of Russian and Ukrainian dollar loans.
The Quinn children and Patricia Quinn, wife of the former billionaire, Sean Quinn, have taken a legal challenge against the appointment of a share receiver, Kieran Wallace, to Quinn Finance Holdings, the ultimate owner of Demesne and other companies in the former family property holding group.
