Is Liberty Mutual buying Quinn Insurance for 'half nothing'?

[PaddyJoe]

I'm not really being facetious with the thread title because it looks like that is more or less the figure that the deal is based on:

LIBERTY MUTUAL’S chief Ted Kelly said that the group has not agreed a price with Anglo Irish Bank to acquire its 49 per cent stake in the joint venture that is set to acquire Quinn Insurance Ltd (QIL).
“We haven’t discussed that,” Mr Kelly said in Dublin yesterday. “The courtship has ended, the marriage has begun, we haven’t yet discussed divorce.” But Mr Kelly said Liberty’s intention is that “we buy the whole company”.

Liberty, the third-largest non-life insurer in the US, is taking a 51 per cent stake in a new company that is acquiring QIL and is providing €102 million in working capital for the insurer.
Anglo owns the balance and has provided €98 million in capital.
With no acquisition price paid and QIL having assets in excess of the capital injected, has Liberty gained control on the cheap?
“We acquired a shell of a company with no capital,” Mr Kelly said. “We recapitalised the company, we’ve picked up the liabilities and risk. The capital going forward is at risk.
“There are plenty of other people out there who weren’t willing to make it work. We were the last one in. That’s an indication of value not being perceived by other potential buyers.
“I wish I could say we got a hell of a deal. Going forward we’ll have to work hard to make this thing work for us,” he added.
Mr Kelly said he expects to get regulatory approvals for the takeover of QIL in September. The business will be given a new brand but Mr Kelly said the name has not yet been chosen. It will be promoted through a major “publicity campaign”.
Mr Kelly said that a new chief executive would be chosen from “within the Liberty family”.

Mr Kelly and Mr Long met with QIL’s 1,600 staff in Enniskillen, Cavan and Blanchardstown on Tuesday. Mr Kelly said he was “very pleased with the reception” they received.
“We admire how they [the staff] kept the business on the rails and we are looking forward to growing the business,” he added.
Mr Kelly confirmed Liberty had acquired the three buildings that QIL will operate from and said this was a sign of its commitment to the Irish operation.
He said Liberty has no plans to outsource any of QIL’s activities.

So we have a US insurer taking control of QI by promising to put in 102 million while the taxpayer puts up 98 million to sweeten the deal with no further control over what happens to the company?
Meanwhile everybody with an insurance policy in the country pays a 2% levy on their premiums for the forseable future to cover the losses that QI made since 2007?
http://www.irishtimes.com/newspaper/...296146576.html

[PaddyJoe]

Profile of Ted Kelly here:
[quote]

[TED KELLY is certainly happy to boast about Liberty Mutual and the credentials that make it a prime candidate among a group of 47 suitors to take over the beleaguered Quinn Insurance. The company, the fifth largest property and casualty or general insurer in the US market, insures 14 million cars globally, including 4.5 million outside the US. As chairman, chief executive and president of Liberty Mutual, Armagh-born Kelly has 45,000 employees in 26 countries under his management and annual revenues of $30 billion (€25 billion).

Kelly has been on the case for at least a year:

Coming from the Border region, Kelly is aware of the significance of Quinn’s role in the area and the difficult employment prospects in the Cavan-Fermanagh area. “It is a pretty important employer – the Quinn family has done well for that area,” he said.
While the administrators are already reducing Quinn Insurance’s 2,450-strong workforce by some 900 jobs to take account of the closed UK business lines, Kelly says that moving quickly on the sale of the business could prevent further redundancies.
“Time is of the essence,” he said. “If they want to extract quality from that – if people want to save the jobs in Fermanagh and Cavan – they have got to get back into proprietary hands quickly. “We would be a good owner. We have demonstrated that. We have built businesses.”

/QUOTE]
http://www.irishtimes.com/newspaper/...271807151.html

[C. Flower]

I heard Eddie Hobbs talking about this and saying yes, it is being given away and in a way in which it can be asset stripped, leaving us with nothing but a bill for 600 million euros.

An indication of what we can expect from privatisation generally.

[ang]

I heard Eddie Hobbs talking about this and saying yes, it is being given away and in a way in which it can be asset stripped, leaving us with nothing but a bill for 600 million euros.

An indication of what we can expect from privatisation generally.

Well it most certainly was given away and as you have already said the same will happen with privatisation.

BTW the price was E1 and the blood sweat and tears of the Irish Nation for years to come.

US giant Liberty Mutual yesterday admitted it bought Quinn Insurance for €1, but insisted it had not gotten the Cavan insurer "on the cheap" since it came with net debts of €81m.

The comments came as Liberty bosses set out its stall for growing Quinn Insurance Limited (QIL) over the coming years, before buying out joint-venture partner Anglo Irish Bank.

http://www.independent.ie/business/i...1-2638086.html

[C. Flower]

Even last year, this would have been a scandal running for weeks on the front pages, but it has hardly been mentioned. That's the way that "shock" works.

[PaddyJoe]

Sudden barrage of extremely irritating Liberty Mutual ads on the radio today. "Hello Ireland..we're new..." in a smug American accent.
No, you fecking aren't. You're Quinn Insurance with some new management.

[Baron von Biffo]

Sudden barrage of extremely irritating Liberty Mutual ads on the radio today. "Hello Ireland..we're new..." in a smug American accent.
No, you fecking aren't. You're Quinn Insurance with some new management.

Took some doing to make QI less attractive but they've managed it. After the second time I'm hitting 'Mute' when I hear that ad starting.

[PaddyJoe]

Sponsoring the Late Late as well. Nice seamless transition from Quinn.

[PaddyJoe]

Back in October 2011 administrators calculated that €738m would be required from the Insurance Compensation Fund to deal with Quinn Insurance issues. This figure is to be recouped from the industry over a period of years through a 2% levy on home, motor and commercial policies.
However, lawyers for the administrators today claimed in the High Court that the actual payout is likely to be between €1.1bn and €1.3bn and could reach €1.6bn in a worse case scenario

Lawyers for the administrators said there were a number of factors that had led to the increase in the amount being sought; including an increased, more pessimistic provision for claims, the euro weakening against sterling, and the decreased value in an investment.
Mr Dunleavy said there had been a culture in Quinn Insurance, particularly in the UK, of under-estimating and under-provisioning the reserves needed for claims and the administrators were adopting a more prudent approach.

Mr Justice Kearns said he wanted to hear in person from the administrators and from a representative of the Central Bank, which is responsible for regulating the insurance industry.
He said there was deep public concern when a set of estimated liabilities were replaced six or seven months later by a completely different set of liabilities.
He added that this was a truly shocking picture and something that required detailed explanation.

http://www.rte.ie/news/2012/0731/qui...ost-1-6bn.html

[riposte]

Clearly these administrators couldn't ogranise a piss-up in a brewery.

[DCon]

Back in October 2011 administrators calculated that €738m would be required from the Insurance Compensation Fund to deal with Quinn Insurance issues. This figure is to be recouped from the industry over a period of years through a 2% levy on home, motor and commercial policies.
However, lawyers for the administrators today claimed in the High Court that the actual payout is likely to be between €1.1bn and €1.3bn and could reach €1.6bn in a worse case scenario


http://www.rte.ie/news/2012/0731/qui...ost-1-6bn.html

The millions Quinn looted from the company to give to his greedy kids should be reclaimed

[People Korps]

this is all just insane , that carpet baggers nab a company that is going to cost the people 1.6 billion for virtually nothing investment wise indicates a level of corruption even difficult to imagine in Fianna Fail days (save for Anglo and their 30 billion) and it is all apparently public and in the courts

NO wonder Enda Kenny never talks to the media as the blueshirts are nest egging like mad
what a joke Ireland has truly become I withhold my next statements as to what should be done about this as they both contravene Irish law and site policy but lead and rope and blade are the key words that would be in the detailed suggestion!!!

[Kev Bar]

Clearly these administrators couldn't ogranise a piss-up in a brewery.

Given what we have heard from the courts, it is also possible the Quinns had wrapped the gig up in a complex layer of deceit.

I think Bertie is responsible for this recent outbreak of PR terrorism.

Bertie then Lowry and O Brien and now the Quinn family.

All of them thinking it is a clever idea to attack the state and its institutions with the spat out froth from the street walking end of the PR industry down on its knees sucking dick.

Where do these scum-bags get off?

They think they can spit jism in my face and have me believe they are heroes.

There may be 4,000 mutants with a border inspired taste for deviancy leading/following them on.

But really to get these inbreds to understand reality, it seems we need to talk to them in their own border language.

And that ideally would mean a whizz of high speed lead passing in the nearest of near proximity to Sean's shyster head.

Yo Sam Lord - did I hear our neo Fianna Fail Sinn Fein friends speaking out in favour of this robber-baron?

No doubt you'll explain that one to me.

Scum.

Scum.

And

Scum.

This is total Hood.

This is robbin not Robin.

Fat Cat Crack Meth Greed Rapist Robbin.

We are not the rope for erotic asphyxiation.

If you do the slime. Then do the time.

Putrid.

You just can't help wondering when the first story will come that will truly tie Sean to his church.

[riposte]

Given what we have heard from the courts, it is also possible the Quinns had wrapped the gig up in a complex layer of deceit.

I think Bertie is responsible for this recent outbreak of PR terrorism.

Bertie then Lowry and O Brien and now the Quinn family.

All of them thinking it is a clever idea to attack the state and its institutions with the spat out froth from the street walking end of the PR industry down on its knees sucking dick.

Where do these scum-bags get off?

They think they can spit jism in my face and have me believe they are heroes.

There may be 4,000 mutants with a border inspired taste for deviancy leading/following them on.

But really to get these inbreds to understand reality, it seems we need to talk to them in their own border language.

And that ideally would mean a whizz of high speed lead passing in the nearest of near proximity to Sean's shyster head.

Yo Sam Lord - did I hear our neo Fianna Fail Sinn Fein friends speaking out in favour of this robber-baron?

No doubt you'll explain that one to me.

Scum.

Scum.

And

Scum.

This is total Hood.

This is robbin not Robin.

Fat Cat Crack Meth Greed Rapist Robbin.

We are not the rope for erotic asphyxiation.

If you do the slime. Then do the time.

Putrid.

You just can't help wondering when the first story will come that will truly tie Sean to his church.

and so elegantly put.

[PaddyJoe]

Back in October 2011 administrators calculated that €738m would be required from the Insurance Compensation Fund to deal with Quinn Insurance issues. This figure is to be recouped from the industry over a period of years through a 2% levy on home, motor and commercial policies.
However, lawyers for the administrators today claimed in the High Court that the actual payout is likely to be between €1.1bn and €1.3bn and could reach €1.6bn in a worse case scenario


http://www.rte.ie/news/2012/0731/qui...ost-1-6bn.html

Michael McAteer of Grant Thornton trying to explain to the Finance Committee how the bill for Quinn Insurance ballooned. A lot of whispering and consulting notes.