Former Irish billionaire Sir Anthony O’Reilly was declared bankrupt by the Supreme Court in the Bahamas. He has been given permission to file for a personal insolvency arrangement, despite objections by AIB, one of his creditors.
The Irish Times reports that on Friday, Justice Milton Evans ruled that O’Reilly, 79, should be adjudged bankrupt and allowed to file for personal insolvency, under Bahamian bankruptcy law.
O’Reilly, a resident of The Bahamas since the 1990s, will be able to apply for a formal agreement with his creditors, known as a composition, which would involve the sale of assets and the distribution of the proceeds to creditors.
O’Reilly, who was not in court for the hearing, was seeking protection from having his property seized, the approval of the composition with creditors and its official registration, and the appointment of a trustee, who will manage his assets and affairs.
AIB, the only creditor to oppose the application, had asked the court to reject the arrangement.
Under the proposal, O’Reilly’s creditors would take a significant cut on what they are owed. While O’Reilly owed money to about 10 banks in total, AIB has been the most aggressive in pursuing its debts through the court and would prefer to continue action throughout the Irish courts in an effort to maximize its return on the sale of assets.
In June 2014, AIB had secured a judgment for €22.5 million (about $24 million) against him. The matter has returned to the court on a number of occasions, most recently last month, with AIB demanding O’Reilly disclose more information about his assets.
According to information the bank supplied in court, O’Reilly still owed AIB €15 million following some asset sales.
O’Reilly, a former Irish and Lions rugby star, was the leading business figure of his day and one of Ireland’s wealthiest men. He was the head of the Heinz Group in the U.S. and a newspaper magnate. His financial downfall came with the collapse of Waterford Wedgewood and the loss from the share price drop of Independent News & Media, of which he was formerly the major shareholder.
In an effort to stave off his banks, he was forced to sell his house on Dublin’s Fitzwilliam Square and his holiday home in Cork, as well as other assets.
According to the Irish Times, information before the Irish High Court last year suggested that O’Reilly’s total debts were around €195 million, but it is believed this figure has since been reduced significantly, possibly closer to €100 million.
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