Questions raised about Zoe management's 'capacity'

AN ACCOUNTANT hired by Dutch-owned lender ACCBank to challenge the survival plan for Liam Carroll’s Zoe group has questioned the “capacity” of the group’s senior management in light of the developer’s illness.

Simon Coyle, an accountant with Mazars, raised queries about the group’s management “capacity” in a submission on behalf of ACC rejecting KPMG’s findings that Zoe had a reasonable prospect of survival.

The court was told last month that Mr Carroll had been ill, was hospitalised and unable to give instructions in the second examinership application by firms in the group. KPMG said it was confident in Zoe’s management, and Mr Carroll’s illness was only recent.

In these circumstances, it was “hardly reasonable to speculate that he will not be able to fulfil his role and that there is a gap in management,” KPMG told the court.

The group plans to strengthen its board by appointing external non-executive directors.

Mr Coyle also questioned if Anglo Irish Bank and Bank of Scotland (Ireland) (BoSI) would honour lease agreements on two buildings to be completed by Zoe.

KPMG said Anglo had agreed to advance a further €68 million to complete their new headquarters at North Wall Quay in Dublin, while BoSI would honour a lease on a block at Cherrywood, Dublin, for which it is contributing loans.

Mr Coyle queried whether Anglo would follow through on the lease in light of its nationalisation and “uncertain future role”, and whether BoSI would lease the other building given its “rumoured exit from the Irish market”.

BoSI, the second largest lender to the group, has said that it will not support the survival plan if it involves the writedown of its €340 million in loans to the group.

BoSI signalled to the High Court that while it supported the second bid for protection, it was opposed to any writedown of its loans proposed by an examiner if the court agrees to appoint one.