Sunday Business Post
“The IBRC commission into the sale of Siteserv to the businessman Denis O’Brien is planning to review text messages sent between the various parties overseeing the transaction.”
Sales of Sunday newspapers were down 6.3% in the first half of 2016. The Business Post outperformed the market with a decline of 3.5% while increasing its share of the market to 11.5%.
The HSE has instructed University Hospital Waterford not to be prescribing home help for patients due to budget constraints. This reads like false economy and more proof of a broken system as it has an impact on hospital beds and may lead to more delays in discharges according to Dr Mark Doyle, clinical director of the hospital.
Pat Hickey accounts for pages in the Business Post and other papers.
“RAS Medical Group, the Irish healthcare group, is seeking to develop five nursing homes as part of a major plan to develop a major care group, according to the company’s chief executive.” They are developing their first home, a 90-bed home, in Roundwood Park estate in Wicklow. This was an ex-Treasury site.
The Kelly family’s Clancourt Holdings has bought the POD nightclub for c.€6m. The company was founded by Charlie Kelly and is run by his two sons, Conor and Kevin. They own a significant number of properties in the Harcourt Street region.
The HSE is owed €22.9m from the estates of various deceased former patients relating to monies owed from the Fair Deal scheme
Cantor Fitzgerald has moved into residential property with the issuance of Loan notes at 75% loan-to-value. Its first such note has already been repaid and the second is a €7m debt package to fund Gordon Lynch’s Ballisk Homes development of 99 units in Donabate. Cantor is marrying funders who are not getting interest from deposits and lending to these type of projects.
Ed O’Flaherty, who had a multi-million exit from the Dublin Whiskey Company, is planning to seed a property fund with some of the proceeds from his exit to buy high-yielding Dublin properties.
On the back of sealing a deal with Walmart, Cocoa Brown is in the talks with Kroger, the second-largest supermarket company in the US.
Lobbyists to greet Simon Coveney in his first two months in office include IRES Reit’s David Ehrlich, New Generation’s Pat Crean and Richard Barrett. Letters were received from Owen O’Callaghan’s company, WK Nowlan, McGarrell Reilly and Park Developments and the O’Flynn group.
Jack Horgan-Jones and Tero Tiilikainen of Key Capital review the second quarter of M&A activity with Carlyle Cardinal’s acquisition of AA Ireland the clear front-runner. There have been a number of Whiskey deals including Danu’s sale of their share in West Cork distillers to Halewood.
Tiilikainen suggests that the best long-term hedge for some companies against Brexit should be to buy a UK company.
David Hall is investing €2m in his core business, Lifeline Ambulance Services, upgrading its fleet.
There is a regional focus on business in the Middle East from Brian Eivers of The Nest Box Egg Company to John Power of Aerogen
There is a factfile on the rise and rise of Deliveroo.
There is a focus on the private education market.
There is also a focus on Irish exploration companies.
There’s a focus on Sinn Fein’s ten-year plan.
The American election is also well covered. The bookies’ odds suggest Hilary has a 73% chance, Trump a 22% chance but they were very wrong on Brexit.
There is an interview with Irishman Gerry O’Reilly who manages one of the world’s biggest mutual funds in Vanguard.
David McWilliams is very worried for the next generation who may not have jobs due to the computerisation of everything, will live longer and will have little or no pension. Long-term Pension provision is undoubtedly a scary thought when we think of the world we are living in now compared to the defined benefit world of the past.
“Dublin fintech start-up Rubicoin has raised €1.2 million in private funding, bringing to €3 million the total raised by the company over four rounds since its 2013 launch. This latest investment from new and existing investors will be used to support plans for international expansion.”
Róisín Burkes’ ear to the ground piece hears that Ronny Rehen and Giles Rothbarth, two very senior Blackrock employees, met Michael Noonan and Des Caville earlier this year.
She also learns that “a rake of former Paddy Power staff have gone to Irish tech firm CarTrawler since former chief executive Paddy Kennedy joined as chairman”
Circle founder Sean Neville revealed to Burke that Spotify’s Alex Norsstrom and former IBM chairman Sam Plmisamo, Facebook director Jim Breyer and Goldman Sachs are backers of the currency transfer software. The initial commission will be 20 basis points but the plan is to get it to zero. Money will be transferred by text or email.
Investors in Hostelworld eagerly await half-year results this week to put in context the 40% drop in share price since the start of the year. One of the forces that has been highlighted by Ryanair maybe the fear of travelling to certain countries in the wake of news about terrorist attacks.
There is a focus on back to school ICT in schools.
There is a focus on various education/work options post-CAO for students
Eddie Cullen, MD of commercial banking in Ulster Bank, is interviewed in the Business Post about his career to-date.
Irish Independent
A special purpose vehicle created to hold Nama’s €5.6bn par value Project Eagle loan book following its sale to US private equity giant Cerberus paid taxes of just €2.5k in 2014. Cerberus acquired the debt at a reduced price of €1.6bn. Details can be seen in the latest accounts for Promontoria Eagle. Another SPV, Beltany Property Finance Ltd whose ultimate owner is Goldman Sachs, recorded a tax bill of just €250 on two loan portfolios it acquired for €500m in 2014.
Damien Gaffney, managing director of Tetrarch Hospitality, has said that Tetrarch may consider “some form of capital event” in 2018 or thereafter. The group’s hotel assets include Citywest Hotel, Mount Juliet, the Marker and Powerscourt in Wicklow. The group has also submitted plans for hotel developments in Sackville Place, Pearse Street and Townsend Street. Gaffney is also the feature of this week’s interview with Gavin McLoughlin.
Irish people place far more importance on brands when buying smartphones, according to Gary Twohig, head of Samsung Ireland. This makes it harder for new phone manufacturers to penetrate the Irish market. Samsung shares are up 30% year-to-date on the back of renewed success in its flagship Galaxy phones.
Both the Sunday Time and Sunday Independent cover Debenhams’s upcoming exit from its examinership process this Thursday. Debenhams were willing to close 5 of its 11 outlets if adequate rent reductions weren’t secured. Kieran Wallace of KPMG was the examiner of the Irish arm. Debenhams Retail (Ireland) had sales of €166m last year but has lost €22.6m over the last three years. The high court approved plan which will see significant rent reductions in 11 of its stores. The deal will see employment secured for its 1,330 employees and 600 staff working for concession holders.
The Hospitality Group (THG), the IFSC-based sports ticketing and hospitality firm, is being sued by Brazilian company Cosan for selling unauthorised VIP corporate packages valued at €85k prior to the Rio Games. THG is a subsidiary of Marcus Evans Group Services Ltd, the firm at the heart of the ticketing scandal in Rio. Kevin Mallon, a company director for Marcus Evans Ltd and finance director in THG, was arrested on Friday.
Brown Thomas is closing its BT2 store on Grafton St store on August 29th. A pop-up store, run by Brown Thomas, will operate in its place until Victoria’s Secret, the American lingerie retailer, takes over the unit in the New Year.
Mike Farnan’s company, Red Strike Marketing, has been brought in to help Ferrari’s growth strategy in China. Farnan was the former managing director of Manchester United International and oversaw its global merchandising growth from 1996 to 2001.
Binary Hub, the apartment block owned by The Student Housing Company, has sold out its apartment block at nearly double the average rent paid by Dublin students. Binary Hub will house 471 students with rooms at €824 per month, just under double DIT’s estimate of the average student rent of €462 per month.
Donegal-born Ricky Simms, owner of Pace Sports Management Company Ltd, is set for a massive windfall in commissions from sponsorship deals for the athletes on his books. Simms represents both Usain Bolt and Mo Farah.
Dan O’Brien discusses “The relentless rise in the cost of social welfare” this week. A number of interesting points were discussed:
- Public social expenditure per person in the OECD has almost doubled in the last 30 years. When countries develop, they expand welfare provisions towards the levels of their richer peers. He uses Mexico, Turkey and South Korea to illustrate this point.
- There is a ratchet effect in social spending: it rises considerably with each recession but does not fall back to pre-recessionary levels once growth has resumed.
- Social transfers accounted for just over 30% of public spending in Ireland in 1995, last year social transfers exceeded 40%.
- In 2012 Irish social spending per person annually stood €200 higher than the average across the EU-15.
- Ireland’s trade surplus rose by 24% in June to €4.55bn. These export totals appear to be distorted by a 12% jump in pharmaceuticals to €2.83bn and a 109% growth in electrical machinery exports to €509m.
Sunday Times
Michael Smurfit Jr. and John Quinn have resigned from the board of quoted company Escher Holdings which develops software for post offices globally; this follows the departure of Bernard Somers in May. Escher is led by CEO Liam Church and marketing boss Finnuala Higgins.
According to the Central Bank’s latest Quarterly Report, household debt has fallen to its lowest level in a decade, however, at an average of €31,216 per capita, Ireland still remains one of the most indebted countries in Europe. Total household debt, now at €148.5bn, has fallen by €9.8bn since the start of 2015. €3.7bn of this reduction is being attributed to write-downs in the value of the almost 50,000 mortgages sold by Irish Banks to the various investment funds. This is a red herring stat as this reduction reflects the market value, i.e. the price the funds paid for the loans, but not what the end borrower still owes.
Eir is considering the sale of its offices and depot on Dame Court in the city centre. The site, which includes a large parking lot, has development potential and is reported to be worth €50m.
Aalto Bio Reagents, an Irish medical company which is developing antigens to help diagnose the Zika virus, has raised a new round of capital from a collection of big hitters including, Tony Barry, Johnny Fortune and McHale Investments. Set up in 1978, the Company is headed by former Trinity Biotech executive, Philip Noone.
Wellness Foods, a vehicle set up by former Kerry Boss, Denis Brosnan, in 2005 to acquire a number of health food businesses, and backed by JP McManus and John Magnier, has exited its last business bringing total disposal proceeds to over €250m. This leaves the vehicle debt free and with over €100m in cash to distribute to its shareholders. Wellness’s main backers are Brosnan’s Lydian Capital and JP McManus and John Magnier backed Erbium. “The company agreed a comprehensive restructuring in 2009 which included the issuance of 25% of the shares in the company to its lenders. A third lender, Bank of Scotland, also took a stake in the company in 2011.” Since then it has been winding down the assets it held within the vehicle.
“Oxigen Environmental, one of the biggest players in the waste industry, is facing the threat of closure at some of its facilities by the Environmental Protection Agency (EPA)”. The plants under threat are located in Ballymount and Clondalkin in Dublin and Dundalk in Louth. The facilities continue to collect waste while in the review process is underway.
Brian Carey reports on the ongoing dispute between the Irish Farmers Association (IFA) and Larry Goodman’s ABP over ABP ceasing to automatically collect an IFA imposed levy on all farmers bring animals to his factories. Carey observes on the pressure coming from the tourism and hospitality to keep VAT rates at 9%, a measure successfully introduced in 2011 to stimulate the sector. Carey also highlights the possible value in Independent New and Media’s share price; “Stripping out its cash, it trades at just two times earnings” according to Carey and is expected to make €35m-€40m in pre-tax profit this year and end the year with €85m in cash.
Dunne and Crescenzi owners, Eileen Dunne Crescenzi and husband Stefano, enjoyed a profit of €560k last year from their two restaurants on South Fredrick St in the city centre and in Sandymount. The couple also has a share, along with partner, David Izzo, in the shopping centre-based restaurant, L’Officina, which has stores in Dundrum and Kildare Village. These two restaurants made profits of €416k last year.
Debenhams is expected to exit from examinership this week with a high court approved plan which will see significant rent reductions in 11 of its stores. The deal will see employment secured for its 1,330 employees and 600 staff working for concession holders.
“More than 300 UK lawyers have registered as solicitors in Ireland so far this year, compared with 70 in 2015”. The move comes to ensure that they can continue to practice EU law after the UK’s move to exit the EU.
According to research from MediaCom, 25% of Irish consumers are delaying big-ticket purchases such as holidays and new cars as a result of Brexit. 44% of those surveyed will budget more carefully now and 65% “felt that Brexit was not good for Ireland and they were concerned about the future of the country”.
The Eurozone’s negative interest rate policy on deposits held at the ECB cost Irish banks and the government almost €33m in 18 months. This is expected to rise in 2016 after the ECB moved the negative from -0.1% to -0.4%.
Samantha McCaughren writes on the recovery of Grafton St and new retail developments in the area.
Gabrielle Monaghan interviews Alan O’Herlihy. O’Herlihy’s company, Everseen, a software company targeted to help retailers identify theft at the point of sales. The CCTV software developed can analyse video footage and compare it with transaction data to identify where items have not been scanned properly.
There is an excellent profile of William Shu, the co-founder and CEO of food delivery app Deliveroo. His company’s brightly coloured delivery bikes seem to be omnipresent in Dublin.
Paul Maher, MD of MicroPro is interviewed by Sandra O’Connell. Maher’s company designs environmentally sustainable computers. With the backing of the EU’s Horizon 2020 research programme, Maher is currently designing a new “sustainably smart” tablet device.
Nick Webb’s inside track this week:
- Bobby Healy, a co-founder of CarTrawler and its largest individual shareholder, has plans to grow the company to be a €10bn business over the next seven years.
- Bob Etchingham, CEO of Applegreen, has invested in a personal capacity in Butler’s pantry, a 20-store “posh food” chain.
- Mindgeek, the world’s largest adult content company, paid €314k in taxes last year, more than many of the vulture funds.
- Danny Murphy, former Topaz CEO, has partnered with Des Hurley’s East Cork Oil. Webb notes the possible expansion of the business as a result of the new team.
- U2’s Princus Investment Trust is among the funders of Cork-based Run Angel. The company is soon to launch a piece of hardware they developed that will make women feel safer when running.
2.5% – 9.8% – The rise in the cost of student accommodation across all seven of Ireland’s universities. @IrishTimesBiz
4.5% – Expected increase in house prices by estate agents over the next year, according to a survey by @centralbank_ie. @IrishTimesBiz
5.9% – The year-on-year increase in UK retail sales for the month of July, according to the @ONS. @IndoBusiness
€1.1bn – The fall in household debt for the first quarter of this year; household debt per capita now stands at c. €31k. @IrishTimesBiz
9.7% – The percentage of vacant houses in Ireland, compared to 2.5% and 2.55% in Holland and England respectively. @IndoBusiness
12% – The decrease in the pound relative to the euro since the day after the Brexit vote. @IrishTimesBiz
€1/£1 – The euro will reach parity with the pound in the next 18 months, according to @HSBC. @IndoBusiness
0.1% – The expected wage decline in the UK for 2016, according to London-based @Cebr_uk. @IndoBusines
0.6% – The year-on-year rise in consumer prices for July in the UK, according to @ONS. @IndoBusiness
0.3% – 0.7% – The expected decrease in Irish GDP growth for both next year and for 2018 as a result of Brexit, according to @SPGlobal.
€4.5bn – The trade surplus for June, a month-on-month rise of 24%, according to the @CSOIreland. @IrishTimesBiz
€3k – The annual income the average worker will get from their private pension, according to research by @StandardLifeplc. @IndoBusiness
167% – The ratio of household debt to disposable income, down significantly from its peak of 215% in mid-2011. @IrishTimesBiz
1.75% – The extra interest paid by Irish borrowers compared to the average rate paid by borrowers in other EU countries. @examinerbiz
5% – The increase in Irish consumer spending in the second quarter of this year, according to the Consumer Market Monitor. @IndoBusiness