The family-owned Quinn Group of Ireland, whose cement business benefited from the country’s building boom, invested its profits in a diverse array of holdings, including insurance and luxury hotels. But Ireland’s financial regulator has put Quinn Insurance in administration, and founder Sean Quinn “is now set to become one of the biggest casualties of the crash,”
the
Financial Times
reported.
According to the
FT
report, Quinn said last year that he had lost more than 1 billion euros in an investment in Anglo Irish Bank and reflected, “We were too greedy.”
His current troubles are arguably more damaging to his business reputation and raise questions about the survival of the Quinn Group.
Ireland’s financial regulator accuses the company of “not maintaining sufficient cash reserves as required by insurance regulations to cover future claims by policyholders.”
In October 2008, Quinn Insurance was fined for making loans of 288 million euros to related family owned companies in breach of insurance regulations. That same month, the Quinn Group disclosed charges of 829 million euros, which are understood to relate to losses incurred on its investment in Anglo Irish…. [T]he last-minute rescue under consideration … would have seen the state-owned lender refinancing 600 million euros of Quinn Group bond debt, while providing a cash injection to Quinn Insurance of 150 million euros…. It looked like another example of the cosy capitalism Ireland is trying to move away from.
The Quinn Group has 5,500 employees, the
FT
article said. “The administrator will be looking for buyers to secure the Quinn Group’s survival,” the report said. (Source:
Financial Times,
April 16, 2010.)
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