The 10 Irish businessmen and lawyers behind the Four Seasons Hotel in Ballsbridge, Dublin, are to be asked by the receiver appointed to the developing companies to part-fund its completion.
However, the investors may insist that the banks, which have funded the project up to now, put more money into the development before they pass over any cash. Construction of the hotel is not complete, although the development is already significantly over budget and a further £10 million may be needed.
Mr Pearse Farrell, of Farrell Grant Sparks, who was appointed receiver to Simmonscourt Holdings Ltd and Harvard Properties Ltd on Wednesday, is also expected to seek funds from the Four Seasons Hotel group.
The banks supporting the project are understood to have already advanced a significant amount of money in addition to the £51 million budget originally allocated for the hotel's construction. They too are expected to be asked to provide further funding.
A group of 10 wealthy Irish individuals, known as the Nollaig Partnership, have a contract to buy the hotel for £60 million once it is completed.
Mr Peter Donnelly, of The Quinlan Partnership, which put together the deal, told The Irish Times on Thursday that the contract for £60 million existed and that nothing further would be forthcoming from the investors. However, other sources have expressed said this might be an opening position.
A spokesman for the partnership said it would hold discussions with Mr Farrell and be of any assistance it could, but that no proposition had yet been put to it by Mr Farrell.
Bank of Scotland (Ireland), formerly Equity Bank, has issued legal proceedings against ACCBank, the leading bank in the group of four banks involved in the project, over its handling of the matter. The other two banks involved in the project are Scotia Bank and Anglo Irish Bank. Bank of Scotland (Ireland) did not support the appointment of Mr Farrell, which was supported by the other three banks.
It is likely ACCBank will vigorously defend the action brought against it. Should the matter go to court, the details of how the project was put in place could be outlined in public.
ACCBank has already made a provision in its books arising from its involvement in the project.
The 10 investors are all Irish. Some are lawyers while others are well-known business figures. Mr Donal Geaney, chairman of Elan Corporation, is understood to be one of those involved.
Mr Farrell is a former partner with A&L Goodbody. His partner in The Quinlan Partnership, Mr Derek Quinlan, is a chartered accountant and was formerly a senior inspector with the Revenue.
The main developers, Simmonscourt Holdings, may still play a role in the development of the hotel, which the receiver is hoping to complete by the end of the year. The directors of Simmonscourt are Mr Sean Dillon, a Dublin estate agent, and two US property developers, Mr Robert Radovan and Mr William Criswell.
Harvard Properties, which acted as a promoter of the development and through which much of the funding passed, has two directors, financial adviser Mr Barry Kenny and the former chairman of ACCBank, Mr Dan McGing. Mr McGing resigned from the board of ACCBank in 1996 and joined Harvard soon after it was incorporated in 1997. The 1999 accounts for Harvard showed creditors of £13.8 million. The Simmonscourt accounts to end 1998, the latest available, show creditors of just under £1 million.
