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O’ Brien – Desmond Letter

Denis is for once on the back-foot as concerns arise about the roles of
IBRC, Cox, Davy and KPMG in the discounted sale of Siteserv to him


 

D E N I S  O ‘  B R I E N

 

Dear Dermot,

Fuming. So the non-story so far: Shareholders in Siteserv got a €5m payment when the company was sold to me for €45m, crystallising a loss to the state of €100m, and even though there were higher offers. Normally, shareholders are – legally – right down the list in the event of insolvency. Perfectly fine. Chinese Walls. Arthur Cox. Davy. Top firms. Good people. And we both know it’s normal that rivals get excluded from the sale process in case they use their access to the books for their own commercial advantage. Nothing to see.

Some Department of Finance officials were uneasy with the way IBRC sold off Siteserv, though the Central Bank scrutinised the deal in 2012 and no regulatory or enforcement action followed. In a memo to Michael Noonan, referred to in the Dáil by Yer Wan, officials said they were “concerned at the number of large transactions [at IBRC] that have been poorly executed under the direction of the bank’s former chief executive”, though Noonan had told her on December 16th, 2014 that he simply was “advised that the board of IBRC at that time were satisfied” that the Siteserv deal represented “the best return for IBRC”, and Finance insisted IBRC change the way it notified it department about such sales. In the last few weeks he summoned CEO Mike Aynsley and chairman, former Fine Gael leader, Alan Dukes to explain their actions and they defended them robustly but Nono Noonan now claiming there assurances that all was okay led to him relaying the same message to Yer Wan. Very striking how bad relations were between the Finance Department, particularly then maverick Sec Gen ‘SIPTU-head’ John Moran, and IBRC.

Walter Hobbs, a consultant who was brought in by IBRC to assess my bid also made it clear it was all above board. I mean these are all the top guys in the area. Walt is managing director of ACT which owns stakes in startup companies Swrve, Firecomms and Biosensia, Funnily enough so do I – through Atlantic Bridge. Nothing to see here. Chinese walls. So we invest in the same thing. Doesn’t mean we hang out. Everyone moaning on about Davy/Carvill which coordinated the sale for Siteserv. So there was a bump in pre-sale trading in the shares. Davy sees no problem with that, and nor do I.The Competition Authority okayed  the purchase on the basis it was a “media” takeover. I mean, I’m a media guy. So what?

Dukes and Aynsley are facing the rap. They say there was absolutely nothing untoward about the way IBRC sold off companies and certainly I saw nothing. Nor did any of my colleagues, friends. No-one. But Noonan banging on anyway about not being kept informed Political correctness gone mad. Worried Noonan not playing ball.

Now there is to be a further inquiry into the transaction by IBRC’s special liquidators. Dukes got annoyed when it was suggested criminality might be part of the investigation. Called press conference in his solicitors’ offices. Class. Eames. Nothing wrong. Dukes said he was both happy and angry about the inquiry.  Is that cognitive, or emotional, dissonance?, Dukesie.

Morrissey went on Finucane to attack the Sunday Times over ludicrous story about shares in Siteserv changing hands at inflated prices in the run up to the buyout. Actually thought Morrissey was shite. Even I didn’t believe what he was saying about the Moriarty Tribunal and then he got outsmarted by Frank Fitzgibbon on how the meter installations are a bigger deal in jobs than in actual finance. Sometimes I think there’s more to PR than just being prepared to say anything I tell him.

“The Irish Stock Exchange is prohibited by law from discussing investigation matters” a spokesman said, “including whether it has ever discussed those matters”. I did laugh a little.

KPMG, the special liquidators to IBRC will investigate a number of IBRC loan-sales in recent years. Of course this is ideal since KPMG itself was one of the advisers in the sale of Siteserv by IBRC in 2012. Then the whole thing will be supervised by a ring of steeler with an unpronounceable name.

The whole thing is Unfair. I’ve no particular links to FG apart from the money I’ve given them, and Lowry getting me and Esat and you the second mobile-licence, bagging €317m for me when we sold it to BT.

Seeking injunction (ring of steel) against RTÉ, preventing a report about my bloody private banking affairs from being broadcast. Senior Counsel foxy Michael Cush – one of the top guys – got RTÉ undertaking not to publish or disclose the material at the centre of the application in the interim. He handed two sealed envelopes to Mr Justice Paul Gilligan. Very James Bond.

Too busy to attend the marrying your second son, Ross, last week – thanks though. At JP’s Adare. The Next Generation. Of course I once announced on the Late Late Show I’d be leaving only the minimum to the O’Brien scions. Got that one from Buffett.

I see it’s been reported you made donations to FF in the US, something I’ve done myself of course. $5,000 donation in the name of Dermot Desmond recorded in December 1990, while two further donations totalling $6,000 and made in 1988 are listed under the name “D Desmond”. Meanwhile the Clinton Foundation charity’s contributors’ webpage records I donated between $5 million and $10 million but doesn’t date the donations. The Wall Street Journal reported I won a $2.5m award in 2011 when Hillary was Secretary of State from a programme run by a State Department agency to provide mobile money services in Haiti after the earthquake. Morrissey confirmed I gave the money but has declined further comment. Nothing to see. As you know.

The whole thing brings back your wisdom of all those  years ago: “The reason I left is to have the freedom to do what I want to do. I’m avoiding politicians, I’m avoiding the press and I’m avoiding small-minded people”.

Bloody Ireland.

May see you  in Royal County Down.

Denis