IDA Ireland, the State's inward investment agency, is taking legal action against a company owned by the New York-listed telecommunications giant, GTT, for the return of about €200,000 in jobs grants.
IDA has filed a High Court action against Perseus Telecom, which provides dedicated telecom lines to connect banks with trading exchanges. Perseus received jobs grants from the State as part of a 2014 deal to open a network operations centre in Galway, which was to be staffed with about 25 engineers.
The investment by Perseus was among a group of jobs announcements made at that year’s Web Summit by the then taoiseach Enda Kenny.
Perseus opened its Galway centre and the company subsequently raised finance from backers including Goldman Sachs. In June of 2017, the company was taken over by GTT, which has annual revenues of about $1.7 billion (€1.4 billion), according to its 2020 filings with the New York Stock Exchange. GTT paid $37.5 million in cash for Perseus.
Subsequent to its takeover by GTT, the Perseus operation in Galway was shut down. IDA then asked the company to return taxpayer grants it had been given to secure the high-value roles, but the State has yet to be repaid by the company.
The decision by IDA to launch High Court action is considered to be a rare legal move against a foreign investor, and is only the fourth such case taken by the investment agency in the last decade.
The last such case it took was to try and secure the return of some €1.2 million in grants that were provided to French-owned energy company, OpenHydro.
IDA is seeking a summary judgment for debt against Perseus, which means the investment agency is seeking repayment of the amount it alleges is owed without a trial.
In effect, it wants a quick decision from a judge on the basis of paper filings. Perseus has not yet filed a defence and may dispute the claim. The company made no response to emails and telephone calls seeking comment on its dispute with IDA, while the investment agency declined to comment.
The Irish unit that is the subject of the lawsuit in recent weeks began reorganising security around its assets, filing a security in the name of a trust firm in Delaware. The Irish company’s board of directors includes some of the top GTT global executives, including chief financial officer, Donna Granato, and GTT’s chief operating officer, Donald MacNeil.
GTT’s share price has come under significant pressure over the last year, falling by more than a quarter. The company was recently rumoured to be looking for buyers for some of its European infrastructure assets, including Perseus.
