DUBLIN: A group of Irish investors in a Radisson Blu Hotel in Southern France launched a High Court challenge against AIB bank’s threat to take over their shares.
Last Month the bank appointed Tom O’Brien of Mazars as receiver to Blagnac Investments Ltd, an Irish-registered investment vehicle that bought the hotel in Toulouse.
The receiver was appointed arising out of Blagnac’s alleged failure to satisfy the bank’s demand for repayment of €27 million which AIB claims is owed to it.
The bank claims it made the demand for repayment after a condition of a mortgage agreement it entered into in respect of the hotel in 2008 was not complied with.
Blagnac disputes the bank’s claim and challenges the validity of AIB’s demand and its appointment of a receiver. It says the appointment could have catastrophic consequence for the operation of the hotel and Blagnac’s shareholders.
The legal challenge by the Irish group was partly heard but was adjourned until Thursday because of a technicality.
The High Court heard it was feared AIB’s action could result in Blagnac having to pay the Radisson group a €3 million penalty due to the early termination of a management agreement Blagnac has with the hotel group. Blagnac also claimed the appointment risks destabilising the hotel’s management team and puts key contracts in jeopardy.
Arising out of the appointment, Blagnac and one of its directors and shareholders Tom Kingston, are seeking a declaration that Mr O’Brien’s appointment on July 17th is invalid and has no legal effect.
Mr Kingston and Blagnac also seek an order restraining the receiver from taking any steps on foot of his powers as a receiver pending the outcome of the full hearing of the case.
