Seán Quinn’s cunning plan…

As the BBC notes, Seán Quinn has told RTÉ’s Prime Time that he has a plan to repay the  €2.8 billion the Quinn family owes Anglo Irish Bank within seven years.  Some turnips may be involved…

Not least of which is that, if this earlier BBC report is correct, there are two separate debts involved.

A year ago, Quinn Cement announced that bulk production was being temporarily halted. The company told 65 workers not to return to work for a month.

The company insisted that the business was sustainable in the long-term but it shares with the other parts of the Quinn Group the burden of approximately 1.2bn euros of debt – a separate debt from that which the family owes. [added emphasis]

Because of the downturn, the servicing of that 1.2bn euros debt relies on healthy revenue streams from the insurance business which Mr Quinn insists remains a cash cow.

Crucially Seán Quinn’s plan involves retaining that “cash cow” within the Quinn Group – contrary to the administrator’s current plan to sell all or part of Quinn Insurance.

The CEO of Quinn Insurance has already left

Separately, the administrators continue to work on an information memorandum (IM) on the sale of Quinn Insurance for distribution to those parties which have expressed an interest in buying the business.

It is believed that 47 expressions of interest have been received, including from Anglo Irish Bank. The IM is expected to be issued next month.

The board of Quinn Group, which is controlled by the family of Seán Quinn, has signalled that it is prepared to sell the business, although approval for any deal will have to be received from the High Court. [added emphasis]

It will also need the approval of the Financial Regulator.

Additionally, Seán Quinn is no longer on the board of Quinn Group Ltd

Mr Quinn said in a statement that his decision was based on his need to concentrate in the short term on Quinn family interests outside of QUINN-group Limited and in particular on the interaction of these interests with Anglo Irish Bank. He also stated that he wanted to avoid any potential conflict of interest associated with the proposed sale of QUINN-Insurance.

Given the history of the Quinn Group, I can’t see the Irish Financial Regulator seriously considering such a cunning plan.

Particularly as his plan clearly demonstrates that Seán Quinn has learned nothing from that history.  From a previously noted Irish Times editorial

The group has a history of falling foul of the regulatory authorities when it comes to the all-important issue of the financial reserves that underpin the insurance policies that it has written for Irish families and businesses.

The repeated blurring of the lines between what is Quinn Insurance’s money; the Quinn Group’s money and on occasion the Quinn family’s money is simply unacceptable for an enterprise that enjoys the public trust. [added emphasis]

, , , , ,

  • Alias

    Quinn’s problem is that his principles markets have collapsed, and he simply doesn’t have the cashflow to find new markets for his building products (Ireland, for example, has an oversupply of private and commercial property that renders the constuction industry dormant for the next 20 years). The taxpayers’ problem is that the state-owned bank is owed a fortune by a man whose assets have collapsed in value.

  • Jane Jaffers

    The taxpayers problem is that they live in a corrupt little (soon to be) failed state.

  • Alias

    Yes, but who was talking about NI?

  • jim

    quinn direct were great paying out whiplash claims in ni.not a bit of wonder he got tuk out by the roots.

  • Glencoppagagh

    It’s not unreasonable to suppose that Quinn could repay the debt over a seven-year period if Quinn Insurance returns to profitability. However, profitability in the insurance business is often a matter of judgement rather than calculation and it really depends on whether its reserves are adequate. A decade or so ago, Irish insurance companies looked extremely unprofitable but it subsequently turned out that they had been putting too much into their reserves.
    Because of uncertaintly over the reserves, any sale of Quinn Insurance is likely to be at a very low price.