Belfast Telegraph

Company Report: PBN Holdings

By John Simpson

PBN Holdings combines the consolidated results for a group of companies in a diverse range of businesses.

The directors describe it as a holding company with subsidiaries in the hotel business, warehousing and storage, retail and wholesale trade in alcoholic and other beverages as well as the development, sale and rental of property.

The annual accounts reflect the size and complications for the company of holding a number of properties whose balance sheet values were affected by the fall in property values. The balance sheet value of property investments peaked in 2008 at over £326m.

Although some of its major property assets are in Great Britain, including the Savoy Centre in Glasgow and the West One Retail Park in Salford, the company is registered in Northern Ireland. In 2007 and 2008 the company spent £99m acquiring these assets as well as spending over £80m on new capital assets.

In 2009 the company balance sheet was seriously affected by an adverse valuation of the physical assets when an unrealised loss of over £48m was deducted from the value of shareholders' funds. This cancelled out a large part of unrealised capital gains.

The balance sheet values of property investments in June 2013 were stated as £285m. A large part of the loans to finance the property assets were transferred to Nama in 2010. PBN has submitted a business plan to Nama which, with Nama support, was expected to allow the inherent long-term value of the assets to be maximised. How the sale of Nama's Northern Ireland portfolio to Cerberus will affect PBN assets remains to be seen.

Recently the company has been trading to reduce the value of outstanding lending, down to nearly £303m, which can be compared to the balance sheet value of the capital assets at £285m.

Pre-tax results were positive in the year to June 2013 although they had been negative in other recent years.

The impact of the transfer to Nama late in 2010 of the financing of the major property assets is welcomed by the company since Nama 'has both the time and resources to support the full exploitation of the asset base'.

In March 2013, Patrick Kearney became the sole shareholder in the company when he purchased the 50% holding formerly held by Neil Adair.

Belfast Telegraph

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