Former Anglo Irish Bank boss Sean FitzPatrick is to tell banks, to whom he owes money, that they will get €8m more if they agree to a private deal instead of forcing him into bankruptcy, RTÉ News can reveal.
Representatives of the former Anglo Irish Bank chairman are to meet creditors next Wednesday in advance of a private High Court hearing on July 12.
Mr FitzPatrick is to contend that creditors, led by State-owned Anglo, will receive full security over a potentially valuable oil project in Nigeria if they sign up to a private deal called a ‘scheme of arrangement’.
He is to highlight what he contends are problems with Anglo's title over the Nigerian oil project. Anglo is owed €110m by Mr FitzPatrick and is opposing any private deal.
It is also expected the former bank boss will indicate that the number of creditors will be kept small under the private deal instead of a potentially much larger number in a bankruptcy.
Other significant creditors are AIB, First Active, Ulster Bank, the Revenue Commissioners, Friends First and Haven Bank owned by EBS Building Society.
It is understood these banks are supportive of the scheme of arrangement because they believe it increases their chances of recouping money.
Under the scheme of arrangement, an independent overseer would be appointed to administer the distribution of funds following the sale of assets.
However, under a bankruptcy all assets would be taken over by an official assignee. In an affidavit filed to the High Court last month Anglo has already rejected Mr FitzPatrick's contention that it does not have full title over the Nigerian oil project.
Anglo's head of corporate development Tom Hunersen told the court that the bank represented 40% of all the indebtedness of Mr FitzPatrick and can block any scheme of arrangement if it comes to a vote.
It is understood that the bank believes it will have less control over Mr FitzPatrick's assets under any private deal.
In an affidavit, Mr FitzPatrick has said the bank had decided to proceed against him even at the expense of its ability to maximise its potential to recover its borrowings. He said that was driven by the public perception that former executive officers of the bank should not be left off the hook.
But this has been rejected by Mr Hunersen, who said there has been no discrimination against him by virtue of his position as a former chairman of the bank.
