Annual pre-tax profits have fallen €7 million to €57.12 million at IRP Holdings, the IFSC-based reinsurance company at the centre of a tussle between its French and US shareholders.
New accounts just filed in the Companies Office reveal that the fall in pre-tax profits came as premiums fell by some €210 million to €323.98 million.
The company was formed in 2001 by French group Scor and Boston private equity group Highfields Capital Management to reinsure 25 per cent of non-life contracts at Scor, the biggest reinsurer in France.
Scor currently owns some 53.35 per cent of IRP Holdings while Highfields owns the remainder. IRP Holdings owns the entire assets of another entity, Irish Reinsurance Partners.
Scor is convening a meeting of its shareholders tomorrow to seek their approval to increase its capital by €149 million, money it wants to use to buy out Highfields under the terms of an agreement in December 2001.
But Highfields is resisting the push to transfer its shareholding and claimed in a statement earlier this month that Scor failed to provide the financial information required to allow the deal to go through tomorrow.
"Highfields is not engaged in negotiations with Scor regarding any agreement under which Highfields would waive any of its rights or claims in exchange for accepting Scor shares in payment for Highfields's interests," it said on May 12th.
Highfields declined to elaborate when asked about the statement and Scor did not make anyone available when asked about the process.
The deal is important for Scor, because the stream of income from IRP Holdings could strengthen its finances as it seeks a ratings upgrade needed to win new business.
While the company is keen to complete the transaction quickly, the 2001 agreement allows the share transfer to be postponed until May 31st next year.
Analysts have said the Highfields stake could be worth €180-€200 million, although it is unclear whether that valuation includes the impact of falling premiums and profits last year.
According to the accounts for 2004, premiums written in EU member states fell to €242.53 million from €367.74 million, while premiums outside the EU fell to €81.45 million from €165.38 million.
The after-tax profit was €50 million, down from €56.13 million.
The wage bill in 2004 for IRP Holdings's three staff was €473,000.
The company's board includes businessman Brian Wilson, a First Active director, and Limerick solicitor Gordon Holmes, who is chairman of the Garda Complaints Board.
After a dividend payment of €28 million, the retained profit of €22 million brought total retained profits from the company to €101 million.
The relationship between IRP Holdings's owners has proven difficult.
The Boston company has taken legal action against Scor on at least two occasions.
