The beef magnate, Mr Larry Goodman, has dropped a €100 million compensation claim over the cancellation of his company's export credit insurance in 1989, writes Arthur Beesley, Political Reporter.
The Government has also agreed to abandon its own claim for €5 million from Mr Goodman.
The Government was criticised last night by the Labour leader, Mr Pat Rabbitte, for agreeing to pay its own legal fees in what he described as a "ridiculous" case.
However, the Government said the €1.46 million in insurance premiums paid to the State by Mr Goodman's company would cover most of its €1.5 million legal fee.
The seeds of the saga were sown in 1987 when the Fianna Fáil government, led by Mr Charles Haughey, sanctioned export credit insurance to Mr Goodman. The insurance was granted by the then Minister for Industry and Commerce, Mr Albert Reynolds. Later, when Mr Reynolds became Taoiseach, it would damage his relationship with the PDs' founder, Mr Des O'Malley.
Mr O'Malley, who as Minister for Industry and Commerce, cancelled Mr Goodman's insurance in 1989, said last night that he had been proven right.
The clash of evidence given by Mr O'Malley and Mr Reynolds to the Beef Tribunal, which investigated allegations of malpractice in the industry, led to the collapse of their government.
Mr O'Malley said: "It was very unwise indeed to have given export credit insurance in the amount that it was given and to have given it in respect of goods that weren't Irish."
The Irish Times was unable to contact Mr Reynolds.