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Celtic Tiger's High Fliers Face Bankruptcy...

McNamara, FitzPatrick facing bankruptcy 'in weeks'...


TWO of the Celtic Tiger's highest fliers -- developer Bernard McNamara and banker Sean FitzPatrick -- face bankruptcy within weeks.

The Irish Independent has learned that Mr McNamara, once worth almost €240m, is facing a fresh attempt by a group of private investors to force him into bankruptcy.

The group is pursuing up to 40 properties owned by the Clare-born builder, records show.

Meanwhile, Anglo Irish Bank will veto any plans by FitzPatrick -- who owes the bank €110m -- to reach a private deal with his creditors.

Both men are now facing the real prospect of having all their assets, including their family homes, seized and sold off.

Pursued

Bankruptcy in Ireland lasts for 12 years, with those declared bankrupt facing travel restrictions, curbs on their ability to borrow money and/or run a business.

Mr McNamara is already being pursued by investors arising from the disastrous Glass Bottle site investment.

But now a second group has emerged to force him finally into bankruptcy, even though it is only owed €2.24m.

Mr McNamara has already had art and other items taken from his home on leafy Ailesbury Road in Dublin 4.

The developer is now facing a war on two fronts as he tries to deal with debts coming to almost €1.5bn.

The High Court yesterday heard there was little chance Mr FitzPatrick could get the support of his creditors for a new arrangement where he would be given time to sort out his debts.

The High Court heard it was "absolutely unimpeachable" Mr FitzPatrick would secure the support of 40pc of his creditors, meaning his bankruptcy is now inevitable barring a change of heart by Anglo.

Ms Justice Elizabeth Dunne also heard an application on behalf of two businessmen, Gary Smith and Ivor Dougan, who are seeking to have Mr McNamara declared bankrupt on foot of a €2.24m judgment the pair obtained against him last February.

The petition was moved by the men after Dublin City Sheriff moved to seize goods from his home on May 18 last.

Mr McNamara's barrister, Bernard Dunleavy, said the developer -- who did not attend in court and was not formally identified during the brief hearing -- was seeking to have the bankruptcy petition dismissed.

The Clare-born builder, who owes some €1.5bn, claims the bankruptcy petition filed by two former shareholders in Novorostan, a property company which had hoped to develop a site close to Grafton Street in Dublin, is flawed.

He will also claim the men are not entitled to bring a bankruptcy petition on foot of an asset seizure by the sheriff and will also challenge the security held by the men in respect of the debt claimed.

Under Ireland's bankruptcy laws, a creditor's petition must state whether any security such as a mortgage or charge is held in respect of the debt.

Securities

However, Mr McNamara will claim that Mr Smith and Mr Dougan have other securities over the debt which have not been formally disclosed.

The bankruptcy move by Mr Smith and Mr Dougan has caught many by surprise as the biggest threat to Mr McNamara to date has been from private clients of Davy Stockbrokers, who backed the soured €412m purchase of the Irish Glass Bottle site in Ringsend in Dublin

The Davy private clients, who include Glen Dimplex owner Martin Naughton and former AIB chairman Lochlainn Quinn, obtained a €62.5m judgment against Mr McNamara last January.

Just weeks later Mr Smith and Mr Dougan also obtained judgment on foot of an earlier High Court settlement under which Mr McNamara was due to pay €5m by December 2008 and a further €2.5m plus interest by January 2009.

Mr McNamara has two weeks to outline his objection and the case has been listed for July 28.

A private hearing involving Mr FitzPatrick will proceed on July 12.

The former Anglo chief had secured temporary court protection earlier this year which prevented creditors from taking legal action against him as he tried to put in place an arrangement to settle his debts.

Anglo Irish Bank holds 40pc of Mr FitzPatrick's debt and, as he needs the support of three-fifths of his creditors to support his scheme, his bid to avoid bankruptcy is likely to fail.


Report by Emmet Oliver and Dearbhail McDonald - Irish Independent

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