Part of Punchestown Racecourse may be sold so that its owners, Kildare Hunt Club (KHC), can settle its liabilities to the billionaire Getty family, writes Laura Slattery

KHC hopes to raise about €10 million from the sale of 20-40 acres of the 466-acre site in order to repay money to the Getty-controlled company, GT Equinus, as well as other debts.

GT Equinus is suing KHC-owned companies, claiming that it is owed a sum of €4.2 million. A preliminary hearing will be held at the Commercial Court on July 31st in relation to the matter.

In a letter to the hunt club's members, KHC chairman and Farmers' Journal editor Matt Dempsey says the sale is necessary to repay outstanding debts, put legal structures in place to implement an agreed Revenue settlement and to secure the long-term future of racing and hunting at Punchestown.

The Gettys invested £3 million Irish pounds in Punchestown in 1998 in exchange for Irish passports under the Government's short-lived "passports for investment" scheme.

The proposed sale, which is backed by the hunt committee, trustees and KHC nominees on the Punchestown boards, will be put to members at an extraordinary general meeting on August 3rd.

The date of the egm coincides with one of the biggest days in Irish racing, when around 45,000 people will attend the Galway Races.

Mr Dempsey told The Irish Times that he expected that members would back the land sale.

"The hunt recognises that the money has to be paid and the most prudent thing is to sell a small part of the land," he said. The sale of the land would not interfere with racing or equestrian events, he added.

Planning permission for a residential development was obtained on the site several years ago, but it is thought that this has now lapsed.

Along with racing, Punchestown also generates revenue from other equine-related events and the Oxegen music festival.

Selling the land to repay GT Equinus as well as money owed to AIB would extricate KHC from an arrangement with the State-owned racing body Horse Racing Ireland (HRI), under which HRI had agreed to repay the loan.

In 2002, HRI struck a management agreement with KHC-owned Blackhall Racing to operate the racecourse, after it ran into financial difficulty. As part of this process, it renegotiated the terms of the loan.

But only part of the HRI rescue plan was implemented. A dispute arose between some members of the hunt club and HRI over leases pledged as security for money owed to AIB and GT Equinus, while the settling of VAT issues was delayed and a proposed joint venture company between HRI and KHC never materialised.

"Broadly the association with Horse Racing Ireland has been extremely productive for both parties, but the hunt believes that it is time for a new structure," Mr Dempsey said yesterday.

But he added that the hunt club was "still keen" to have a relationship with HRI going forward.