South Wharf shareholders due a windfall

South Wharf shareholders are due a new year windfall after voting to sell the company to developers Bernard McNamara and Derek Quinlan and Dublin Docklands Development Authority (DDDA) for €412 million

South Wharf derived from the old Ardagh Glass plc four years ago in a restructuring orchestrated by financier Paul Coulson. Ardagh shareholders had the option of taking up a stake in South Wharf. Its sole asset was the site of a defunct bottling plant in Ringsend, Dublin.

The sale of the company and its key asset means that individual shareholders will make a profit of roughly €7 for every €1 they held in South Wharf at the time of the split.

Stakeholders voted by a majority of 99.9 per cent in favour of the sale at an extraordinary general meeting in Dublin yesterday.

The vote had to go to a poll. The High Court has to formally approve the deal and details of the transfer have to be lodged with the Companies Registration Office, and the company will have to be delisted. After the meeting, Mr Coulson said that these steps would be taken in January. He predicted that if everything goes to plan, shareholders should get paid at the end of next month or early in February.

Long-term shareholder Dan O'Donohoe told The Irish Times: "I view it as a satisfactory outcome. I've been a shareholder since the 60s and people like me have been very patient." He said the business remained stagnant in the 90s until Mr Coulson and his backers took over.

The deal will cost South Wharf's buyers €424.346 million, including transaction costs.

The buyers are using a vehicle dubbed Bidco to complete the deal. It will fund the purchase using €288.391 million debt and €135.955 million equity.

DDDA is contributing €32.175 million in equity; Mr Quinlan will add €46.28 million; Mr McNamara's share will be €57.5 million. Of this, Davy Stockbrokers will raise €52.25 million from private investors. Mr McNamara's vehicle, BMcNCo, is committed to repaying this at 17 per cent over seven years, or after two years subject to a minimum return of 40 per cent.