Yesterday I raised with the Taoiseach concerns over the sale of Siteserv by IBRC to Millington following very serious revelations in Department of Finance memos released under freedom of information provisions to Deputy Catherine Murphy and The Sunday Times. The concerns revealed are very grave indeed. I refer to the speaking notes for the Minister's meeting with IBRC on 25 July 2012. In the documents, the civil servants state:
We are concerned that IBRC consider the CBI report compiled on the transaction vindicates their position.
To be clear we are concerned with a number of the decisions taken by the bank in relation to this transaction including
The decision to allow the sale process to be run by SiteServ's advisors
The decision to exclude trade buyers from the process
The timing of the exclusivity period when there were other bids outstanding
The payment of €5m to existing shareholders
1. Is IBRC satisfied that this transaction represented the best commercial outcome for the bank?
2. We want an independent commercial assessment completed for this transaction.
That is what Department of Finance officials in the shareholder unit were saying to their Minister before his meeting with IBRC. They went on to state: "The reputation of IBRC and by extension the State is vulnerable due to the approach taken by the bank in relation to these matters" and that IBRC's "processes should be beyond challenge to protect this".
Essentially, a company that was insolvent and owed €150 million was allowed to run this sale. Some of the shareholders were clients of Davy, which represents an obvious conflict of interest. Davy said to give them €5 million to vote the sale through. It is a handy €5 million, probably the handiest anybody ever earned. Shareholders in a company that was essentially bust got €5 million to vote. Did that not ring alarm bells with the Minister? He met the chairman and CEO. His officials were saying very clearly they wanted an independent review of the transaction. The Minister met Mr. Alan Dukes, chairman of the bank at the time, and Mr. Mike Aynsley, the CEO, and they persuaded him not to pursue the independent review. Clearly, he backed off and the trail ended. Therefore, the Minister did not face them down or do what he should have done, namely, ensure there was an independent review of the transaction. Why did the Minister not insist on an independent review of the transaction?
The Taoiseach said yesterday he did not read the report in The Sunday Times but I take it he has been well briefed at this stage. I asked the Taoiseach yesterday, and am asking him again today, whether the Government will establish a proper inquiry to investigate this deal and concerns the Department of Finance officials had over the operation and management of the IBRC.