Danske Bank is seeking an insolvency action against the troubled Gemini portfolio.
The Danish Bank, which is one of the lenders to the 35-strong securitised portfolio formerly owned by Glen Maud’s Propinvest, is making the move in order to recover its investment.
Documentation relating to the Gemini Propinvest securitisation is understood to have put the bank’s position junior to other investors, so it may not recoup its investment if there is a shortfall in proceeds from working out the portfolio.
A stock exchange notice said that recent developments “namely the continued withdrawal of funds from the stand-by account and the master servicer’s announcement that it will seek directions from the high court as to its obligations under the transaction documents, have left [Danske Bank] with no choice but to issue proceedings seeking a declaration as to the insolvency of the issuer and the duties to which the directors are subject.”
It added that noteholders will be updated on any material developments in relation to this matter in due course.
This is not the first legal action related to collapse of the Gemini portfolio which was once valued at £1.2bn but had fallen to just £437m when it was put into administration in August 2012.
The special purpose vehicle behind the Barclays loan used to fund Propinvest’s acquisition of the portfolio in 2006 is currently pursuing a valuation claim against CBRE and Warwick Street, a former King Sturge subsidiary.
