It is believed talks between developers Ray and Danny Grehan and Nama over the repayment of a €650 million debt are ongoing tonight.
The brothers are believed to have asked the National Asset Management Agency (Nama) for more time on the repayment demand to allow for an outside investor to seek to purchase their debts.
In an unusual move, Nama asked the statutory receivers it had appointed to property assets owned by the Grehans and their company, Glenkerrin, last week to stand down on Friday at midnight.
Control of the properties were returned to Glenkerrin and the Grehans on Saturday morning. However, the State loans agency issued a new demand for the repayment of the loans that same day – allowing the Grehan brothers until 5pm today – giving them just one working day to repay the €650 million debt.
A spokesman for Nama said the failure to meet the repayment demand by the deadline will lead to the statutory receivers, Michael McAteer and Paul McCann, being reappointed.
The agency also intends to seek the appointment of an administrator to take control of the company’s properties in the UK – the first such legal move by Nama. The Grehans have had discussions with the Dublin investment advisers Incisive Capital Management about the purchase of Glenkerrin’s debts by an investment fund.
A number of potential bidders have expressed an interest in buying the debts from Nama at a discount to the face value of the loans. Any sale of the debt must be approved by Nama.
It is understood that among the proposals in the sale of the debts are incentive payments to the Grehans under a deal where they would manage assets and develop unfinished sites for an investor.
Sources stressed that Nama could object to this proposal but still agree a deal to sell the Glenkerrin debts following the reappointment of statutory receivers.
There is understood to be interest from investors in the purchase of Glenkerrin’s debts as about 50 per cent of the company’s assets are in the UK market, which is performing considerably better than the Irish market.
Glenkerrin has rental income of about €11 million in the UK, a valuable undeveloped site in Canary Wharf, a shopping development in Ealing Broadway in west London and a hotel in the east of the city, the Crowne Plaza in Shoreditch.
Nama is said to be keen to avoid prejudicing any offer for the company’s debts, though it will still appoint receivers to Glenkerrin and the assets of the Grehans if they fail to meet the terms of an agreement with the State agency.
The agency asked the statutory receivers to stand down pending a longer loan repayment demand on legal advice after receiving a request from the Grehans for further time to consider their options.
The Grehans are expected to push for an extension on the debt repayment to facilitate the purchase of the loans from Nama by an investment fund. They have claimed that a receivership would significantly reduce the value of their assets.
Glenkerrin has held discussions with former investment banker Aogan Foley of Incisive about a possible deal for the firm’s debts.
Nama has previously sold debt owing by one of its borrowers.
Loans due by property investor Derek Quinlan, one of Nama’s largest debtors, relating to his stake in the five-star Maybourne Hotel Group in London were sold to a Malaysian sovereign wealth fund last month for €57 million.
Relations between Nama and the Grehans broke down last week after the brothers sought legal advice instead of signing up to documentation improving the agency’s security over their loans.
The agency appointed receivers after the Grehans had failed to meet terms under the memorandum of understanding agreed with the State agency following approval of their business plan.
The Grehans are seeking legal advice over the agency’s actions.
