McInerney close to deal with banks

HOUSEBUILDER McInerney is close to concluding a deal with its Irish bankers that will secure the company’s future until next March.

The group’s main businesses in Ireland and Britain have slumped since 2008 as a result of the recession, and it has been in talks with its bankers since late last year.

The company told shareholders at its annual general meeting yesterday it had restructured its core Irish loans and that it expected to sign an agreement shortly.

Finance officer Enda Cunningham explained after the meeting that the company had a draft agreement with a syndicate of banks – Bank of Ireland, Anglo Irish Bank and KBC – which should be finalised this month.

“That will give us total security of funding until March 2011,” he said. The group’s Irish debts total €111 million. Around 75 per cent of this will end up in Nama, the State rescue agency for the banks, which is likely to take over the loans towards the end of this year.

McInerney has restarted work on eight Irish building sites in Clare, Cork, Limerick and Waterford, which had been mothballed, and on 10 in Britain. The company has secured funding from its banks for these projects, which it restarted as sales inquiries in specific regions began to increase in recent months.

Its British bankers, which are owed €125 million, are renewing terms with the company on a month-to-month basis pending the outcome of a review of the business being conducted by Goldman Sachs. This may lead to a rights issue, although speakers from the small group of shareholders who attended the agm in Ballsbridge, Dublin, were sceptical that such a move would solve the group’s problems.

The review may also determine the progress of a proposal from former managing director Barry O’Connor to buy its Spanish businesses.

The courts there appointed an administrator to one of its three operations, Alanda Homes, after McInerney stopped funding the business. Mr O’Connor did not comment on his plans yesterday.