Irish regulators this week won a court order to place Quinn Insurance Ltd. under administration, a form of bankruptcy protection.
John Hennessy, a lawyer representing the Financial Regulator, told a court that the agency believed Quinn Insurance had breached its solvency ratios and there were concerns whether the company could meet its liabilities to policyholders.
Justice John Cooke appointed Paul McCann and Michael Ateer of the accounting firm Grant Thornton as joint administrators.
The Financial Regulator said the move “will allow the firm to remain open for business, to continue to be run as a going concern under different management and to put the business on a sound commercial and financial footing.”
Quinn Group, the parent company, said it was “deeply disappointing in the context of the continued profitability of the group which is currently in excess of euro20 million per month.”
Separately, the Financial Regulator ordered Quinn Insurance to cease writing new business in the United Kingdom, where it was losing money.
These actions do not apply to Quinn Life, a separate company, the agency said.
The companies were founded by Irish billionaire Sean Quinn, and were once among the fastest growing businesses in the country.
The Financial Regulator said Quinn Insurance had gone from a position of having assets of euro200 million ($269.64 million) more than liabilities to having liabilities euro200 million greater than assets.
“The Regulator has seen fit to take this action in the context of a perceived depreciation of the underlying assets of Quinn Insurance Ltd.,” Quinn Group’s statement said.
“We feel that this issue could have been resolved to the benefit of all in a relatively short space of time and we will be working with the Regulator and the provisional administrators to resolve all outstanding matters.”
Quinn Insurance Ltd. reported a pretax profit of euro83.5 million in 2008, compared to a loss of euro425 million a year earlier, the Independent reported.
Sean Quinn’s privately owned Quinn Group has interests in construction, chemicals, energy, health care, hotels and plastics.
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