B&Q SUPPLIERS TO GET 10% IN RESCUE PLAN - Suppliers are being offered 10% of the €3 million due to them in the proposals to rescue DIY chain, B&Q, which has been under High Court protection from its creditors since January, writes the Irish Times. The High Court appointed Declan McDonald of PricewaterhouseCoopers as examiner to the Kingfisher plc-owned chain in January in a bid to rescue the business which was heading for a loss of €20 million this year and was crippled by excessive rents. The rescue plan drawn up by Mr McDonald proposes that suppliers accept 10% of the amount due to them in settlement of the debt. The figures show that trade creditors, who are treated as a specific group under the proposals, are owed a total of €3.3 million. The document also proposes that B&Q’s main creditors, its parent and associated group companies, will not receive any of the €22.4 million due to them. At the same time Kingfisher will put €2.4 million back into the business by way of an equity investment. This cash will be used to pay the examiner’s costs, the 10% due to trade creditors and to provide working capital to the company. Preferential creditors, including the Revenue Commissioners, who are owed €1.9 million, and a number of local authorities, will receive 100% of what is due to them.
IBRC WANTS RETIRED EXECUTIVE TO REPAY €6m - The retired chief executive of the former Anglo Irish Bank operation in the UK is being pursued for the repayment of most of his 2005 retirement package worth around €6m, reports today's Irish Independent. Anglo's successor, Irish Bank Resolution Corporation (IBRC), now in special liquidation, wants John Rowan to repay the money, claiming the payment was not approved at a general meeting as required by law. The package was agreed in 2005 between Mr Rowan and the then Anglo CEO Sean FitzPatrick, it is claimed. Yesterday, Mr Justice Peter Kelly granted Mr Rowan's application to have the case against him transferred to the Commercial Court, saying he was satisfied the matter came within the rules allowing such matters to be dealt with by the court. Counsel for IBRC argued it was a contract of employment matter and should go through the normal High Court process rather than the Commercial Court. The judge said he did not believe it fell foul of the court rules and he adjourned the matter to July 29 for further directions. In its action, IBRC is seeking a number of declarations including that the purported "resignation agreement" with Mr Rowan in December 2005 is void because under Section 186 of the Companies Act 1963 the payments first required approval from a general meeting of the bank.
SPREAD BETTING COMPANY SUES ERNST & YOUNG FOR NEGLIGENCE - Accountancy firm Ernst & Young & is being sued by a market trading company specialising in spread betting for alleged negligence over its auditing services, writes the Irish Examiner. WorldSpreads claims it could not continue to trade after a shortfall was allowed to grow over a number of years in its client account balances, which may exceed £22m (€26m). It was unable to comply with UK Financial Service Authority (FSA) regulations and led to its board putting the company into special administration in March last year. It claims Ernst & Young & was negligent in the performance of its services and obligations to WorldSpreads Ltd in connection with audits carried out between 2007 and 2011. The case was transferred to the Commercial Court yesterday by Mr Justice Peter Kelly on consent between the parties. WorldSpreads Ltd is registered in the UK and a wholly-owned subsidiary of WorldSpreads Plc, which is registered in Ireland. It was an online financial markets trading business whose principal activity was the provision of spread betting services, including on foreign exchange, futures and options.
ITALY PREMIER ENRICO LETTA TEARS UP €6 BILLION IN TAX RISES - Enrico Letta, Italy’s new centre-left prime minister leading an unprecedented grand coalition, cancelled planned tax rises worth up to €6 billion in a clear break with the policies of his technocrat predecessors. Laying out his programme in his first speech to parliament, Mr Letta said Europe faced a “crisis of legitimacy” and had to change its focus on austerity. He said he would visit Berlin, Brussels and Paris this week to press his case, writes the Financial Times. “We will die of fiscal consolidation alone. Growth policies cannot wait any longer,” Mr Letta said, describing Italy’s economic situation as “serious” after nearly two years of recession. In the section of his speech most eagerly anticipated by Italians and by Silvio Berlusconi, former prime minister and centre-right coalition partner, Mr Letta announced the government would not impose the first instalment of an unpopular housing tax due in June nor increase value added tax in July as Mario Monti’s previous government had planned. But while Mr Letta promised that Italy would abide by fiscal commitments made to Europe he did not explain where the government would find the lost revenues of up to €6 billion. Scant reference was made to cuts in public spending, beyond an end to funding of political parties and salaries for ministers. Mr Letta made no mention either of privatisation of state-controlled companies or sales of state assets.