Belfast Telegraph

Tycoon in legal threat to Nama

By Margaret Canning

A Northern Irish developer is considering legal action after the Republic's 'toxic bank' Nama struck its biggest ever deal.

Nama has sold €800m (£700m) worth of loans associated with three top London hotels to the owners of a daily newspaper.

The agency said it had completed the sale of borrowings attached to Claridge's, the Connaught and the Berkeley hotels to Maybourne Finance, controlled by Daily Telegraph owners Sir David and Sir Frederick Barclay.

The three hotels and the Savoy had been bought in 2005 for £750m by the Maybourne Hotel Group, a group of investors including Belfast-born developer Paddy McKillen, the hotel group's biggest shareholder, and financier Derek Quinlan.

Last night, however, Mr McKillen, was considering mounting a legal action to scupper the deal, claiming he wasn't consulted.

A spokeswoman for Mr McKillen, who earlier this year won a major victory in a court battle against Nama to stop it from transferring some of his other loans to the agency, said he was concerned.

"He is investigating the deal and is concerned about how the sale may affect his shareholding," she said.

Mr McKillen, she added, has no intention of selling his stake in the hotels. All four hotels are five-star London landmarks.

A Nama spokesman said: "The loans had been provided to the Maybourne Hotel Group by two Irish banks to fund the acquisition of the hotels in 2005.

"Nama acquired the loans at the end of June 2010 from the banks. The loans were sold for in excess of €800m with Nama recovering 100% of the original value of the loans plus interest."

The transaction gives Sir David and Sir Frederick - commonly known as the Barclay Brothers -full control of Maybourne.

The brothers, who also own the Ritz in London as well as The Spectator magazine and The Telegraph Media Group, acquired a majority stake in the equity of Maybourne in January but also wanted full control of its debt.

The 2005 purchase by Maybourne Hotel Group, hailed as a milestone in Irish developers' incursions into British property during the Celtic Tiger boom, was funded by Allied Irish Banks and Anglo Irish Bank, both of which are now in State ownership.

Mr Quinlan sold the Savoy for £200m not long after acquiring it.

Nama has instructed London auction house Christie's in the sale of Derek Quinlan's art collection, including a work by pop artist Andy Warhol with a guide price of up to $600,000 (£388,650). It also appointed receivers to nine properties belonging to Mr Quinlan, his wife and children earlier this year.

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Notoriously secretive, Belfast native Paddy McKillen this year succeeded in a High Court action to challenge Nama's absorption of loans of €1.4bn (£1.2bn) which he said were fully performing. His spokeswoman has claimed that Nama did yesterday's deal with the Barclay brothers at a time when Mr McKillen was working with the billionaires to refinance loans associated with his hotels with a view to repaying the agency

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