Treasury accused of ‘pie in sky’ as Ronan battles bank

DEVELOPER Johnny Ronan battled for business survival yesterday as his property firm was accused of having unrealistic hopes that a ‘white knight’ would come to its rescue.

Treasury Holdings, one of Dublin’s biggest landowners, was accused of being ‘pie in the sky’ when it comes to accepting the realities of its downfall.

The claim was made by lawyers for KBC Bank, which is asking the High Court to wind up the business. The bank is owed about €70million by Treasury Holdings and is its second biggest creditor after Nama.

The Irish arm of the company had enjoyed big successes with prize assets such as Dublin’s National Convention Centre. But cash reserves plummeted last year and Nama moved to take control of Treasury’s €1.7billion loan-book – prompting court action by the firm in January to block the move.

Last month, Treasury lost its civil suit against Nama, when a judge gave the agency permission to take control of its loans. That gave rise to yesterday’s emergency application.

While rejecting Nama’s takeover, Treasury has sought another investor to buy its loans. Lyndon McCann SC, for KBC, told the court: ‘Suggesting there should be no winding up so they can continue to look for other potential investors is effectively asking the court to allow those companies to trade while insolvent.

‘Maybe Treasury can’t accept the fact they are wholly insolvent. I can understand why they may want to continue to manage the assets. I can understand why they may want the banks to indulge them ad infinitum.’

If Treasury is wound up then a liquidator would take charge of its assets and would have the power to sell them off and return any cash proceeds to KBC.

Mr McCann described claims by Treasury that the bank has any ‘ulterior motive’ in seeking to wind up the firm as ‘outrageous’.

The barrister said there is nothing cynical in a bank that is owed money making attempts to recover it. He said Treasury has an ‘aspirational, pie in the sky approach where they hope a white knight will come with so much money in his hand that he’ll make it impossible to say no to any offer.’

But Michael Collins SC, for Treasury, said: ‘We live in the real world’, pointing out that the application makes no reference to assets in China – where Mr Ronan and his business parnter Richard Barrett are said to be continuing to expand his empire at present.

Mr Justice Brian McGovern said that if the company is insolvent and unable to pay its debts, then ‘on the face of it’, KBC is entitled to a winding up order.

The hearing continues.