Dáil Éireann díospóireacht -
Wednesday, 24 Mar 1993

Vol. 428 No. 2

Ceisteanna—Questions. Oral Answers. - Sale of State Company Shares.

Pat Rabbitte

Ceist:

14 Mr. Rabbitte asked the Minister for Finance if, in view of his statement to Dáil Éireann to the effect that the management of Greencore had contacts with a series of potential trade purchasers of the State's shareholding in the company, without the Minister or his Department being aware of these contacts, he will give details of the steps, if any, which are being taken to ensure that shares held by him in any company are not again offered for sale without his knowledge; if he has spoken to the Board of Management of Greencore about their actions in this regard; and if he will make a statement on the matter.

Mr. B. Ahern

Neither the board nor the management of Greencore public limited company offered the State's shareholding in that company for sale. The question of taking any action of the type suggested by the Deputy does not therefore arise. The position is that the company had, over recent months, made contact with a series of potential development partners. On 16 February 1993 the company advised my Department that it had identified a US based major food company which it described as the ideal partner for the growth strategy planned by Greencore and which was interested in acquiring virtually all of the remaining State shares. Before the Government had an opportunity to consider the proposal, several Irish food companies expressed an interest in acquiring the Government stake.

I should add that, under the rules of the Stock Exchange, I would, as a shareholder, be excluded from any information which would not be given to all the shareholders in the normal course. Neither I nor my Department are privy to the workings of the board of Greencore public limited company.

As I indicated to the House on 3 March last, the Government allowed a period of three weeks, which expires today, to all interested parties to put forward proposals to my Department.

Mr. Rabbitte

May I ask the Minister if he accepts that a stake which he holds in the name of the Irish people, which may be worth £60 million or whatever, was being touted around by his own word — if I were permitted to quote at Question Time I would give the date — without the Minister again, in his own words — even being aware of it? Is it not a reasonable question to ask whether against the background of the scandal which took place in the same company approximately 18 months ago, when the Minister for Agriculture and Food gave undertakings in this House that in that instance, where executives used borrowed funds from the parent company to buy a minority stake in Sugar Distributors Limited, which they resold at a sixfold profit, and it was admitted here that the Government did not know, undertakings were given to this House that we would know in future, it amounts to a dereliction of duty on the part of the Minister and his Department that we did not know our remaining stake holding was being sold off by executives in the existing Greencore company?

Mr. B. Ahern

I accept it is a fair question but I would reiterate what the position was. The Greencore mangement or board did not sell any shares. What they did was to look at what would be the best strategic advantage for the development of Greencore in the future. As I told Deputy Rabbitte here three weeks ago, I had no knowledge that they had any of those meetings until 16 February when they advised my Department. I should also like to inform Deputy Rabbitte that under the rules of the Stock Exchange I do not own Greencore, neither do I control the board or the management. I am a shareholder. Under Stock Exchange rules I would be excluded from any information which would not be given to all the shareholders. In the interests of trying to develop the company and examine what was best for them——

Mr. Yates

The Minister has a golden share.

Mr. B. Ahern

Yes, but the golden share is on the sugar quota and not on the normal shares, which is a different matter.

Mr. Dukes

That is not what the Minister said three weeks ago.

Mr. B. Ahern

It is precisely what I said three weeks ago.

Mr. Dukes

It is totally different.

An Ceann Comhairle

Let us not forget these are priority questions and only the Minister and Deputy Rabbitte may intervene.

Mr. Dukes

The Minister set out a list of things which the golden share covers.

Mr. Rabbitte

I cannot accept that if somebody is outside Croke Park on an All-Ireland Day selling the colours of the teams that they are there simply to offer them; they are actually engaged in the business of selling them. The Minister for Finance owns the stake in the name of the Irish people. There are no Stock Exchange rules that remove from him the responsibility to know if the company purported to sell off that stake. What does the Minister purport to do if the only bidder at the end of today is a Chicago-based multinational? For example, does he intend to have any regard to the revolt on his own backbenches or does he consider Deputy Upton and others merely to be all talk and no action? Does he not accept that it is inconsistent with the Culliton report which argued for a State shareholding rather than to dole out grants in strategic indigenous companies? Here is a major indigenous food company and it is inconsistent with the strategy of building up indigenous companies, capable of trading abroad, to go ahead with the sale of these shares.

Mr. B. Ahern

Deputy Rabbitte has asked a number of questions. First, I should say that the Minister for Agriculture, Food and Forestry holds the golden share and the Minister for Finance deals with the ordinary shareholding. In so far as the management of Greencore were selling shares that would certainly upset the Minister for Finance. They were not selling shares. Like any good State board they were looking at how they could strategically develop Greencore plc., how they could continue to expand it and how this could be done in the best interests of the company and agriculture.

Mr. Dukes

They were asking other people how much they would pay for their own property.

Mr. B. Ahern

Whatever proposals I receive by 5 p.m. this evening will be brought to the Government in due course and they will decide what action to take. In connection with Archer Daniels and Company I do not see them as a Chicagobased company only; they are major players within the Irish economy both in employment and in investment terms. That has to be taken into account but equally any other proposals will be fully examined and evaluated.

An Ceann Comhairle

Let us come to deal with other questions to the same Minister. Question No. 15, Deputy Michael McDowell's question.