Irish books retailer Eason is seeking court approval for a demerger of companies within the group that could lead to some €60 million being available for distribution to shareholders from sales from its property portfolio.

Eason Holdings plc wants the Commercial Court to confirm a decision approved at an extraordinary general meeting (egm) last September to reduce the company’s share premium account by €47.2 million, and reduce its capital by cancelling 20 million ordinary shares valued at €15 million in total.

The application is part of a reorganisation of the company, which has a property portfolio valued at €88 million-€96 million.

Eason Holdings director Liam Hanly said in an affidavit the capital share reductions were unanimously passed at last September's egm.

He said the Eason Group had in 2013 commenced a process of separating the property and retail trading arms of Eason and Son Ltd following a decision that existing group structures were no longer optimal.

It was decided to streamline the group with a view to facilitating property and/or trade disposals in the future.

Over-capitalised

The board is of the view the company is over-capitalised, with the majority of realisable shareholder value reflected in the value of its property portfolio, he says.

It has decided to realise as much value as possible by selling freehold properties within the group and delivering the majority of capital proceeds back to shareholders.

At the same time it wants to create a viable, appropriately capitalised and commercial independent trading company, Mr Hanly said.

Following disposal of the property element, there is expected to be €60 million in 2020 for distribution to shareholders, Mr Hanly said.

The share capital reduction application came before Mr Justice Robert Haughton on Monday, when he adjourned the matter for hearing on March 1st.