A Buyer for Anglo Irish?

[mollox]

RTE report this morning that the Malabraca Consortium are interested in buying Anglo Irish Bank and are prepared to put €5bn in new capital into the bank.
According to RTE they’ve approached the Government about this, but their plans have been put on hold because of the recent garda intervention.
RTE says the consortium has a new management team ready to go into the bank.

http://www.rte.ie/business/2009/0227/anglo.html

This consortium was originally put together to have a go at BOI.

Now wouldn’t that confound the experts if someone was actually willing to buy an Irish bank – and Anglo at that!

If that didn’t get Lenihan an Oscar, nothing ever will.

[LeftOfCentre]

Seriously had to check the date to see if it was apr 1 ! . . . . . . this will come to nothing, no company would accept the massive potential debts.

[mollox]

Seriously had to check the date to see if it was apr 1 ! . . . . . . this will come to nothing, no company would accept the massive potential debts.

Well that's the conventional wisdom, so let's all hope you're wrong!

[Victor Meldrew]

Quoting RTE " Under the proposal the investors would inject €5 billion of equity into the bank. They would assume majority control and share risks with the State"

Note the phrase "majority control and share risks".

This smells a bit though... What institutions are going to put up the 5bn?

[mollox]

Quoting RTE " Under the proposal the investors would inject €5 billion of equity into the bank. They would assume majority control and share risks with the State"

Note the phrase "majority control and share risks".

This smells a bit though... What institutions are going to put up the 5bn?

According to RTE, the consortium would take the first €750m in losses, the state would take the next €750m - and any further losses would be shared on a 50:50 basis.

The fact that some investor would be putting forward a serious proposal must surely suggest that things may not be quite as bad in Anglo as the markets/commentators would have us believe.

[islands]

On Morning Ireland they wondered aloud what does Anglo have that could attract that sort of money.

Genuine question: Is it naive to answer "land"?

[Dreaded_Estate]

If we can get anyone to take any of the Anglo risks away from us it will be a fantastic result. I doubt the govermenent would allow private equity to pick through the carcass of it's developer friends. But we'll see

[Thac0man]

Quoting RTE " Under the proposal the investors would inject €5 billion of equity into the bank. They would assume majority control and share risks with the State"

Note the phrase "majority control and share risks".

This smells a bit though... What institutions are going to put up the 5bn?

Yes, that did occour to me. However I would imagine that any proposed take over will only go ahead once the issue of toxic debts is dealt with. . . . but are they really that toxic? One mans junk is another mans gold.

The hundreds of millions owed to Anglo could make it a viable bank for private interests, even a cash cow. That Anglo says this money cannot be recovered is clearly boll*x of the highest order - as the claim is in a report authored by a bank that cooked its own books.

There is nothing to say this consortium could not persue indebted developers for swathes of their assets, which may appreciate considerably over a relatively short time.

If the government keeps its hand in Anglo and lets a private consortium wrench assets off high debtors there is nothing to say both parties could not profit greatly. Certianly a private consortium could happily do what the state simply cannot, turn a healthy profit and persue developers to the bitter end.

[islands]

This smells a bit though... What institutions are going to put up the 5bn?

As far as I recall it was two large private equity firms (Carleton and another one), a sovereign wealth fund, and two Irish private equity firms: Sorrento and I think Cardinal. But that's from memory from the car radio, so I could well be wrong

[islands]

Here is the story on Reuters
Consortium held talks on Anglo Irish stake -report | Industries | Financial Services & Real Estate | Reuters

DUBLIN, Feb 27 (Reuters) - A consortium of Irish and foreign investors has held talks with the government over taking a majority stake in Anglo Irish Bank, which was nationalised last month, public broadcaster RTE said on Friday.

Anglo Irish Bank declined to comment on the report, which did not cite sources. The finance ministry was not immediately available for comment.

Anglo Irish Bank, Ireland's no. 3 lender before it was taken into state owenership, has been at the centre of a string of scandals that have badly damaged Ireland's overseas reputation.

RTE said the consortium included U.S. and Middle Eastern investors and had held discussions with the government and the state's debt-raising arm, the National Treasury Management Agency.

But RTE added that the consortium had written to the state to put their interest in Anglo on hold while investigations into the bank were ongoing.

Police, including fraud investigators, carried out searches at Anglo Irish Bank's offices this week.

Ireland's Office of the Director of Corporate Enforcement and the financial regulator are investigating the bank over directors' loans from Anglo Irish Bank, allegations of share price manipulation and claims it used multibillion euro transfers from bancassurer Irish Life & Permanent ([COLOR=#0000ff]IPM.I[/COLOR]) to boost its deposit base.

RTE said under the proposals made the consortium would invest 5 billion euros ($6.36 billion) in Anglo Irish Bank if a deal could be agreed. (Reporting by Jonathan Saul, editing by Will Waterman)