PROPERTY DEVELOPER Patrick McKillen has said he has a deal with the Irish Bank Resolution Corporation – formerly Anglo – to pay back nearly €1 billion worth of personal and company borrowings over the next five years.
Mr McKillen, under cross-examination in the High Court in London, said he has an agreement to sell properties “mostly in Boston” to pay down part of his personal debts owed to the IBRC.
Negotiations have been under way for months with the IBRC to extend some of his personal and companies’ loans to five years, with €240 million to be paid this year, €309 million in 2013 and €355 million in 2014.
However, he could not confirm that a deal exists in writing: “I do not think it exists in writing but it is agreed in terms. Maybe it is in writing,” he told Mr Kenneth MacLean, QC.
Meanwhile, the court heard of a series of negotiations over the last six months where Mr McKillen sought to raise the money to buy all or part of property investor Derek Quinlan’s shares in the company that owns three London hotels, if they become available.
Businessmen David and Frederick Barclay have said that Mr McKillen would not have had the money to buy Mr Quinlan’s shares, even if they had been put up for sale in line with the pre-emption clause in the shareholders’ agreement.
One of the interested parties, Talos Capital, got in touch with him after they had asked the National Asset Management Agency for his telephone number and addresses, he said.
Another party who displayed interest, Hong-Kong-based businessman Walther Kwok, was arrested in Hong Kong on corruption charges last week and released on bail, the court heard.
US hedge fund Och Ziff offered to lend £48 million at 15 per cent interest compounded quarterly and to set up a company to buy Mr Quinlan’s shares if they came on the market. The loan would cost 1.9 times the amount originally offered if it was repaid within three years; 2.25 times if paid back in four years and 2.75 times if not repaid for five years.
He accepted that capital repayments due on two €2.3 million mortgages held on two luxury south of France villas were not paid earlier this year, but he insisted payment had not been demanded.
A letter to Mr McKillen from the lender Bank of Scotland (Ireland) on March 9th this year said that “not all aspects of our overall relationship are positive either.
“We note that capital repayments have not been met in line with the agreed facility agreements since the last meeting in December on loans relating to Villa Santa Lucia and the Villa Sol,” Mr MacLean quoted from the letter.
However, Mr McKillen said the payments were “not a lot of money” and had not been paid because the debts were part of his wider talks with BOSI to renegotiate his loans. “It is part of a refinance which takes in the entire accounts. It is not that we could not pay it.”
