State rears up on O’Reilly firm

The State has yet again gone legal on Sir Anthony O'Reilly, the retired 78-year old former billionaire and one-time Heinz chief executive.

A few weeks after The Irish Times revealed that taxpayer-owned AIB was preparing to drag him through the courts over his debts to the institution, Enterprise Ireland is now gearing up to do the same to one of his oldest companies.

EI owns about €830,000 worth of preference shares, effectively a form of debt that spews out an annual dividend, in the motor signage company Rennicks, which is in turn owned by the Fitzwilton group.

O'Reilly owns Fitzwilton in conjunction with his brother-in-law, wealthy Greek shipping magnate Peter Goulandris.

Goulandris’s sister Chryss is married to O’Reilly. The two men control it through an investment vehicle called Gilholme, registered in the Bahamas, where O’Reilly is also tax resident.

A financial dispute has arisen between EI and Rennicks over some historical grants and the associated preference shares, and the State agency has hired Crosskerrys, a debt specialist law firm, to file a case against Rennicks and Fitzwilton in the courts.

O'Reilly's lawyers recently told the High Court during a hearing for the AIB action that his shareholding in Fitzwilton is one of his few assets not pledged as security to anybody, and that he would talk to Goulandris about selling it.

Fitzwilton has wound down from its heyday during the 1980s and 1990s, but still holds some valuable investments, most notably Rennicks, which has decent operations in Ireland and Britain.

Fitzwilton also owns Mobile Traffic Solutions, which distributes Rennicks's products, and a stake in Portfolio Design Group International, a financial services company.

AIB’s action against O’Reilly, in which the bank is trying to recover €22 million from him personally, is back up before the courts next Monday week, June 23rd. Another financial lawsuit against one of his few remaining unencumbered assets is the last thing O’Reilly needs.