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Property developer hits out at group over bonds sale

By Tim Healy

Published 13/10/2015

Property developer Patrick Kearney claims Davy stockbrokers were negligent to advise him to sell bonds at a price he says was a significant undervalue.

Mr Kearney and Kilmona Holdings are suing J&E Davy at the Commercial Court over advice the stockbrokers allegedly gave in 2014 on the sale of Anglo Irish Bank subordinated bonds.

In an affidavit, Mr Kearney, of Queensway Quay, Gibraltar, says he and a company called Pattan Sl were advanced a loan by the former Anglo Irish Bank in 2009 to buy the bonds.

Anglo's successor, IBRC, later assigned the benefit of the loans to a company called Stapleford Finance.

In 2014, Mr Kearney engaged LeBruin Private to advise him on his debt obligations to Stapleford.

Following discussions, it was decided Davy would sell the bonds at a price that discharged the €2.36m (£1.75m) debt to Stapleford and left a balance to divide between him, LeBruin and Davy.

The bonds were sold for 20.25 cent in the euro, or €5.58m (£4.13m), but Mr Kearney says he met with an investment banker, who later agreed to buy them for 32 cent in the euro. Mr Kearney says he was dissuaded by Davy and LeBruin as he was already legally committed to selling.

The case continues.

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