Feltrim Mining, the exploration company set up by Mr Conor Haughey in 1988, twice staved off collapse, largely through the intervention of Mr Dermot Desmond, the former Taoiseach's son conceded yesterday.
Mr Desmond had not taken a stake in the company when it was first floated on the London and Dublin stock exchanges in April 1988, Mr Haughey told the Moriarty tribunal. It was only when he was "approached effectively for a loan", in July 1990, that the head of National City Brokers had purchased 83,333 shares, Mr Haughey recalled.
Some British investors in the company had failed to settle their account on foot of a second flotation, which raised £400,000 for Feltrim: "We all used our best endeavours to pick up the shortfall. I approached Dermot Desmond," he said. Others approached were Mr Emmett O'Connell and Davy Stockbrokers.
Without the intervention of Mr Desmond's NCB, Eglinton Exploration, chaired by Mr O'Connell, and Davy the entire flotation would have had to be repaid to subscribers and Feltrim would have collapsed. Mr John Coughlan SC, for the tribunal, questioned Mr Haughey on Mr Desmond's role in the rescue. The NCB head had agreed readily to the rescue initiative, Mr Haughey said.
He again approached Mr Desmond when Feltrim was in crisis as a number of lorry-driver creditors were threatening to enter a petition to wind up the company.
Mr Desmond came up with £55,000 in loans, which were later converted into shares, said Mr Haughey. Mr John Stakelum had given £15,000 in loans, which were also converted into share capital.
These transactions were essentially different from the £6,421 Feltrim's chairman, Mr Bernard Cahill, had advanced to save the crucial patent for a leaching process that was to become the company's main asset.
Mr Haughey disagreed with Mr Cahill's statement on Friday that Mr Haughey's father had phoned him and invited him to become chairman of the company. He had initiated the contact himself, he said, and invited Mr Cahill to come on board.
Mr Stafford had lent £40,000 to fund the flotation, which was oversubscribed, with the shares doubling in value on the first day. That loan was repaid from the flotation. The company ran into problems in the west of Ireland because of the use of cyanide in an area of high rainfall which could have been disastrous for the streams and rivers of Connemara.
After the flotation the company became "environmentally friendly", said Mr Haughey. The new non-cyanide leaching process developed by the Dublin Institute of Technology was seen as a major breakthrough, with worldwide implications.
Mr Haughey was at pains to prove to the tribunal that Feltrim was his own idea. "Prior to Jim Stafford's involvement it was my concept. I'd been working on it for two years," he said.
Mr Haughey was also asked about Celtic Mist, the family yacht. The late Mr Liam McGonigal, his father's friend, had found the yacht in Palma, Majorca, and it was purchased in about January 1988 for £120,000 sterling through a yacht broker, Ms Louise Shand.
He and his brothers, Sean and Ciaran, went with Mr Brian Stafford, an amateur skipper, to bring the yacht to Ireland. It was registered in Mr Stafford's name to facilitate customs clearance but was subsequently purchased by the Haughey family's Larchfield Securities through accountants Deloitte Touche on a bill of sale dated May 19th, 1989. Deloitte Touche did not appear to have a record of the VAT payment for the purchase, said Mr Coughlan.