The Rhatigan Property Group and merchant bank Goldman Sachs have settled a legal battle over an €80 million debt and the ownership of a high-profile hotel.
The group, controlled by developer Padraic Rhatigan, earlier this year challenged the right of Goldman Sachs affiliate, Beltany Properties, to appoint a receiver to a number of its assets, including the Radisson Blu Hotel on Golden Lane in Dublin, on foot of an €80 million debt.
It is understood that the Rhatigan group, Beltany and Goldman Sachs have agreed to settle the dispute and will drop all litigation.
At the same time, the bank’s affiliate will refinance the property group’s existing loans, becoming its new lender.
The agreement covers the Radisson Blu along with the Le Pole House and Latin Hall office blocks in Dublin city centre, six properties in the IDA Business Park, Garrycastle, Athlone and the Atlantaquarium in Salthill, Galway.
It will give the group scope to invest in its existing assets.
Project Nadal
Along with those properties, over the last 18 months, Beltany bought loans to Rhatigan companies that were secured on the Radisson Blu in Sligo and a number of other assets. Under the deal’s terms, different lenders will refinance those debts.
Goldman Sachs bought the €80 million debt secured on the Radisson in Golden Lane and the commercial properties in Dublin and Athlone in 2014 from Ulster Bank, which sold it as part of a portfolio dubbed Project Nadal.
The dispute, which blew up earlier this year, centred on the interpretation of the agreement struck between the Rhatigan companies, headed by Luxor, and Ulster Bank, when the loans were restructured in 2013.
Goldman Sachs and Beltany claimed this meant that, along with the debt, Luxor and the other companies owed them a fee related to the hotel’s value.
However, the Rhatigan group argued the fee was payable only under the restructuring agreement which no longer applied as it was able to clear all its liabilities.
The property group maintained that Goldman Sachs and Beltany were using this argument simply as a means of taking control of the Golden Lane hotel, which was the portfolio’s prize asset.
Beltany moved to enforce the debt and appointed a receiver to the hotel and the other properties in April. However, Luxor challenged this in the High Court on the basis that the company was prepared to repay all of the €80 million debt. It had alternative finance in place since January.
Challenge
The challenge led to a number of hearings in the court’s commercial division, where Mr Justice Brian McGovern ruled in favour of the Rhatigan companies last June. Beltany and Goldman were preparing to appeal, but will drop this under the agreement’s terms.
The property development companies are separate from Mr Rhatigan's building business, JJ Rhatigan.
