Smurfit Kappa hires chairman after Fitzpatrick quits over loan scandal

Liam O’Mahoney, chief executive of building materials group CRH, has stepped into the role at the Irish corrugated group after Fitzpatrick was implicated in a long-term scheme to hide a loan at Anglo Irish Bank, where he was chairman, from its shareholders.

Since taking on the chief executive position at CRH in 2000, O’Mahoney has overseen its growth from turnover of €6bn to €20bn business. He is due to retire from that position this week (31 December).

In a statement, he said: “I am honoured to become Chairman of Smurfit Kappa Group and look forward to contributing to its progress in this challenging business environment.”

Fitzpatrick tendered his resignation from Smurfit Kappa a week before Christmas after it emerged that as chairman of Anglo Irish Bank he covered up loans of €87m, around £82m, from its shareholders over a period of eight years up to 2007.

According to reports, the loans were temporarily transferred to another financial institution prior to the banking group’s 30 September year-end every year for eight years up to 2007. It is understood that the loans were then transferred back to the bank after 30 September, thereby hiding them from the bank’s shareholders.

Fitzpatrick resigned his post as chairman of Anglo Irish alongside David Drumm, the bank’s chief executive, on 19 September. He tendered his resignation at Smurfit Kappa on the same day.

In a statement, Smurfit Kappa said: “The board has accepted his resignation with regret. The board and management of the Group acknowledge the major contribution Sean has made to the group since his appointment as chairman in March 2007 and wish him well for the future.”

As well as resigning from Smurfit Kappa and Anglo Irish, Fitzpatrick also resigned a series of non-executive positions at Greencore Group, Aer Lingus, Experian and Gartmore Irish Growth Fund.