Dáil Éireann Debate, Wednesday - 18 April 2018
23. Deputy Richard Boyd Barrett asked the Minister for Business, Enterprise and Innovation if reports that €7 million of debt was written off in the recent sale of the State's stake in a studio, details supplied, are correct; the price secured for this sale; the process engaged in for the sale; and if she will make a statement on the matter. [17123/18]
Amharc ar fhreagraI want to revisit the sale of Ardmore Studios. I will be blunt in stating that the sale stinks to high heaven. How much did the State get for the sale of its one third share in the company? I have heard the sale price was €6 million and the sale involved the State writing off €7 million in debt owed to it by Ardmore Studios. This would mean we gave the company away and then gave the purchaser €1 million. I hope that is not true. The House, members of the public and people working in the film industry need to know what is going on here.
In 2016, Ardmore Studios International Limited, ASIL, engaged IBI Corporate Finance to investigate selling the company as a going concern. ASIL, the majority shareholders in Ardmore Studios Limited, were seeking to exit, having been running the company for more than 30 years. An extensive process was undertaken by IBI Corporate Finance to find a suitable buyer, with more than 100 potential parties contacted. Ion Equity emerged as the successful bidder from that process and its acquisition vehicle, Olcott Entertainment Limited, which was recently incorporated by Ion Equity for this purpose, is now the new owner of Ardmore Studios.
With regard to the sale price and other specific financial details, I am unable to reveal what are confidential details of Enterprise Ireland’s minority shareholding disposal transaction in what is a privately held company. This applies to the Ardmore Studios transaction as it would to any other individual investment or share disposal of Enterprise Ireland where it is a minority shareholder in a privately held company. This principle of confidentiality reflects a statutory duty of confidentiality set out in section 16 of the Industrial Development (Enterprise Ireland) Act 1998. In this case, the parties also understood at the time of the sale by Enterprise Ireland and other majority shareholder vendors that, owing to section 16 of the 1998 Act, the consideration and other financial aspects of the sale would not be revealed. Disclosing such information would be in breach of the high standards of confidentiality adhered to by Enterprise Ireland.
I can confirm, however, that Enterprise Ireland negotiated the sale of its shareholding with the benefit of comprehensive due diligence undertaken by independent consultants and is satisfied that it realised full market value on a par with the other majority shareholder parties. The Government had committed that the company would be sold as a going concern and the final decision would be taken in consultation with me, as Minister for Business, Enterprise and Innovation, Enterprise Ireland and the Minister for Culture, Heritage and the Gaeltacht. This is what happened, while realising full commercial value for the shareholders selling the company, including Enterprise Ireland.
I will be honest; this is a load of rubbish. The public is having the wool pulled over its eyes. Ardmore Studios are located on a large piece of real estate. A recent attempt by the current chief executive officer to have part of the site rezoned for residential development was blocked by Wicklow County Council. One property expert estimated that if Ardmore Studios were rezoned for residential development, the site would be worth approximately €100 million. I would like to know if it is true that the Government was advised on the sale of this very valuable property by a director of Savills, the property people, who is now on the board of the company that took over Ardmore Studios and has a record of trying to rezone the site.
What guarantees are there that film production at the studios will continue? Only one of seven stages at the site is being used, while films are being made in buildings owned by the National Asset Management Agency, including a factory in Tallaght and the former John Player factory on the South Circular Road where a dispute is taking place and four workers were recently sacked for kicking up about conditions. Films are also being made in the Dublin sport hotel, while Ardmore Studios are empty. This stinks, yet the Minister cannot answer my question as to whether the State wrote off €7 million in debts held by the studio.
Is the Minister seriously suggesting this House does not deserve to know that?
To be clear, this was a commercial deal. It was negotiated commercially. There was a guarantee for the workers and I believe their future is secured in terms of there being investment in Ardmore Studios. I visited the studio some time ago. It badly needed investment. This is an opportunity to expand the facility there. The Deputy talks about planning permission. Both he and I know that it is the preserve of the elected members of Wicklow County Council to change the zoning of any area. That is outside my control and that of the Deputy. I am quite sure that when the local authority sees the advantage of this investment in Ardmore, it will be quite happy to make sure that it remains a location for the film industry. Altering the current zoning restrictions cannot be done without the agreement of Wicklow County Council. The State will continue to support the film sector through the Irish Film Board, tax incentives and other measures. The Irish Film Board also welcomed the acquisition of Ardmore Studios by Olcott Entertainment Limited. It stated that:
The Studios continue to represent a vitally important part of the infrastructure of the Irish film industry. It is very heartening to hear about the commitment of the new owners to their investment in and the development of these historic studios.
There is a commitment on the part of the new owners to invest in the site.
The public has a right to know what is happening with the expenditure of public money. The Minister is just not answering the questions. It is reported that Ardmore owed the State €7 million. According to the Irish Film Board's accounts, I suspect that this figure included moneys given by members of the board to themselves when they were working in Ardmore - people like Kevin Moriarty, the former CEO, who got €594,000 in two different loans. Were these loans ever paid back? No, I think they are part of the €7 million debt. Somebody else-----
I ask the Deputy to refrain from mentioning names.
People on the board who were also working in Ardmore effectively gave themselves loans for a studio that now sits empty. The CEO of Ardmore prior to the sale attempted to rezone the land for residential development and will remain the CEO with the new purchaser and the Minister is telling us that Ardmore is secure for film production in the future when they have already tried to rezone it for residential development. Sure, Wicklow County Council blocked it but why did we sell to people who have shown a record of wanting to run the place down and possibly get it rezoned for residential development? The Minister cannot tell us about the €7 million owed to the State in loans that were given to Ardmore. It is extraordinary.
It is not a case of somebody blocking zoning. The facts are, and the Deputy knows this as well as I do, that the Ardmore site is currently zoned for film industry use only. This can only be changed by a decision of the elected members of Wicklow County Council so as far as I am concerned it could not be in safer hands. Why would anybody want to rezone an area that has huge potential for an area where there are other-----
The owners can push.
The owners cannot zone anything and the Deputy and I know that. It is up to the elected members. It is zoned for film production. There is another film production centre down the road from it. I see that as offering huge potential for a cluster for the film industry. As the Deputy and I know, the amount of interest in increasing that industry is tremendous and many more people are coming in from abroad along with a lot more indigenous Irish industry. Enterprise Ireland has an investment portfolio of €300 million and 2,000 investments. It has investments of circa €30 million per annum and sells shares worth €25 million. These are all confidential transactions. I cannot give that information because it would be wrong of me to do so. Enterprise Ireland's accounts detail how all of its funds are appropriated or otherwise. It issues an annual report every year.
