Ireland’s Nama faces Dublin court case

Treasury Holdings has warned it will suffer “irreversible and catastrophic damage” if a decision by Ireland’s National Asset Management Agency to appoint receivers to 36 of its Irish properties is not reversed.

In Dublin’s commercial court on Tuesday, Treasury alleged the decision by Nama last month to appoint receivers to the properties could result in the calling-in of loans in other unrelated parts of its property empire not subject to Nama loans.

The company claimed the action could also threaten talks with a significant Asian investor, which is interested in acquiring a stake in Treasury China Trust - a company listed in Singapore with a $1bn property portfolio - and a separate company that manages TCT’s business.

Treasury, which is co-owned by businessman Johnny Ronan and his partner Richard Barrett, is one of Ireland’s biggest developers.

The company is challenging a decision last month by Nama - a state agency set up in 2009 to purge Irish banks of their toxic property loans - to appoint receivers to assets linked to €1.5bn of loans that it acquired from Treasury. Treasury wants the court to grant an injunction against this action and is seeking damages from Nama.

Counsel for Treasury told the court Nama had acted in breach of fair procedures by not giving Treasury the right to present its case to the agency before deciding to appoint receivers on December 8. He said Nama had been “less than open and transparent” in its dealing with Treasury by failing to tell the company it had decided to move to enforcement until January for a full month after making the decision.

The court heard Nama has described Treasury as “hopelessly and grossly insolvent” as its liabilities greatly exceeded the value of assets on its balance sheet because of the extraordinary decline in property prices. However, counsel for Treasury said the company was pursuing a strategy to allow it to exit Nama and had lined up potential investors, Australian investment bank Macquarie and global real estate group Hines. The company alleges Nama rejected the investors’ offer without proper consideration.

Treasury claims its dealings with Nama have been punctuated by “extraordinarily damaging commercial decision-making on the part of Nama”, according to affidavits submitted to the court.

Treasury claims it received a bid worth €805m for a significant portion of its Nama debt from CIM, an US real estate private equity firm. But Nama delayed sign off on the deal when it became concerned about an acquisition of shares in TCT by Treasury founders, Mr Ronan and Mr Barrett. Treasury claims Nama had full knowledge of the transaction and alleges Nama’s delay on the CIM deal caused it to fall apart when Irish property prices declined further.

The case continues on Wednesday.