Paddy McKillen resists Nama transfer of London hotel loans

BUSINESSMAN PADDY McKillen has tried to resist the transfer of loans to the London five-star hotel chain, Maybourne Hotel Group, of which he is a significant shareholder, to the National Asset Management Agency (Nama).

Loans financed by Irish banks to the group, which owns Claridges, the Berkeley and the Connaught hotels, are expected to be transferred to Nama due to the shareholding held by financier Derek Quinlan in the business.

Mr Quinlan, a minority shareholder in the group, is among the top 10 borrowers moving to Nama in the first wave of transfers.

It was previously suggested that Mr McKillen was among the top 10 due to his connection with Mr Quinlan. However, a spokeswoman for Mr McKillen said that he was not among the 10. The National Treasury Management Agency, under whose remit Nama falls, had written to him to confirm that he was not among the top 10 borrowers, she said.

It is understood that, because Mr Quinlan is among the 10, Irish bank loans provided to the hotel group may be drawn into Nama in the first loan transfers.

Sources said banks were anticipating that where others had jointly borrowed with one of the top 10, including associated loans, the joint loan would be drawn in in the first wave.

“It is impossible to know at this stage whether our debt will be transferred to Nama,” the hotel group said in a statement. “If the loans are transferred to Nama it will be because of the association of a minority shareholder.

“This would be a purely technical event regarding the underlying debt of the group and would leave the management, ownership and structure of the hotels totally unaffected,” the group said.

The hotel’s loans are “fully performing” and that no loan covenants had been breached, it said.

Nama is buying portfolios of development loans including associated performing loans.

Mr McKillen could avoid the transfer of the group’s Irish bank loans into Nama by refinancing with another lender. Anglo Irish Bank and Bank of Ireland are listed among the group’s bankers in its most recently filed accounts.