Sunday Business Post
There is plenty in the SBP on Donald Trump and also a few articles on him bringing Denis O’Brien’s relationship with the Clintons into the mix. Interestingly, Ian Kehoe says that, “Portions of what Trump said will not be repeated in Irish publications due to this country’s strict libel regime.” This article leads onto another one on the same page speculating about whether O’Brien will try to float Digicel again in the near future.
“A Belgian Hotel group backed by more than 40 Irish investors, including U2 bassist Adam Clayton and drummer Larry Mullen, is to be sold by Jones Lang La Salle for an expected €100m.” Investors in the ’06/’07 venture are expected to get a quarter of their money back. There is €90m owed to AIB and KBC and it is throwing off a minimum of €7m per annum.
Hugh O’Donnell speculates what the budget will bring us on Tuesday week. He expects cigarettes to go up, but alcohol and fuel to remain unchanged. An income tax rebate of between €5k and €15k is expected for first-time buyers. Mary Regan and Hugh O’Connell also have articles on the budget later in the paper.
The necessity to get opposition buy-in for the planned budget has probably has led to more leaks than usual.
Tom Kavanagh of Deloitte has been appointed as examiner to Celtic Linen. David Martin, James Anderson and Neil Mullarkey are listed as the people in Deloitte to talk to regarding any interest from potential investors.
Peter Gallagher, the second eldest son of the Gallagher family who own 75% of listed new homes developer Abbey, is getting ready to make waves at the AGM this Friday. Gallagher, who owns 9%, is critical of its pace of development in Ireland, thinks the auditor of 25 years should be replaced and thinks his brother “should become more hands on”. Abbey reported a €61.5m profit last year, up from €49.1m the year before, off turnover of €199m. It completed 597 houses, 544 of which were in Britain.
Rothschild have narrowed the sale of Gaelectric to three prospective parties. China General Nuclear Power is said to be interested in its cross-border wind farm portfolio. Viridian and Equitrix are also said to be interested.
John Malone catapulted himself into a clear second in the Irish hotel room ownership stakes during the week with the acquisition of Paul Fitzpatrick’s collection of the Morgan, Spencer and Beacon hotels. The Times notes that Patron Capital Partners, a European private equity fund, has more than doubled its money on the sale of the Spencer Hotel.
Johnny Ronan’s Ronan Group Real Estate and Colony Capital acquired the €43m 1m sq. ft. development site beside the convention centre on Spencer Dock. He has plans to build two new hotels and student accommodation on the site.
35-year-old Larry Goodman Jnr. is busy with his Urban Life development company. He has 270 units launching in Co. Louth shortly across Dundalk, Drogheda, Castlebellingham and Termonfeckin.
Martin Naughton, founder of Glen Dimplex, is worried about the effect of Brexit. He thinks “There’s going to be two or three very difficult years in business, the one thing we don’t like is uncertainty and we’re in a period of uncertainty.” He thinks there could be a mild recession in Britain. He thinks the Apple case will take four or five years to go through the courts and will not affect us in the short to medium term at least.
A group of prime Mayo assets including theatres, hotels and conference centres in Castlebar sold by KPMG as part of a portfolio to Goldman Sachs are subject to a court challenge whereby Island Properties, led by Seamus Sutcliffe, are claiming they had a deal to buy these off the Receiver.
“Irish sports media platform Pundit Arena is planning to raise up to €3m and open an office in New York.”
Ed Micheau comments on the decision of Michael O’Leary to take the 60 horses he had in training with Willie Mullins out of Mullins’ yard over a dispute regarding training fees.
“Roomex, the Irish hotel booking platform for business travel, has raised €3.5m in a Series A funding round led by Frontline Ventures and backed by veteran technology entrepreneurs Paddy Holahan [of Hostelworld fame] and Bobby Healy [of Car Trawler fame].” They say they have more than doubled sales every year for the past three years which is phenomenal.
Cork car firm Johnson & Perrott posted pre-tax profits of €4.6m last year, an increase from €3.6m in 2014. Revenues rose from €63m to €77m. Mark Whitaker, a sixth generation descendant of the Johnson family, runs the business.
There is a detailed analysis of the property market across the country, including commentary from David McWilliams.
Jack Horgan-Jones will be following the Project Eagle probe.
Maurice Healy, CEO of the Healy Group, who is an entrant in the EY Entrepreneur of the Year, is interviewed. He expects turnover in his business to grow from €70m in 2013 to €100m this year. He believes in giving 20% of the business’ profits to good causes. He thinks Brexit will bring opportunities to buy companies in the UK.
Susan O’Keefe writes about Pat Hickey.
Aidan Brogan, CEO of the resurgent and fast-growing company Datalex, is interviewed in the Business Post. In the 90s it had a NASDAQ-quoted valuation of €400m and then went on to be valued at close to nothing. It is leading the way in innovation for airline booking software and associated e-commerce solutions. Pageant Holdings has a large stake, while Dermot Desmond has been in since the early days and is still a significant shareholder.
Stephen Kinsella comments on the possible knock-on effects of the 11.25% wage increase Dublin Bus drivers will get over the next three years. The State cannot afford any increases in excess of the Lansdowne Road agreement and the majority of the private sector cannot afford any increases.
Joe Healy, head of the IFA, writes about how Irish farmers are paying interest rates 2% higher than their EU counterparts.
Majella Crennan of Philip Lee writes about what companies need to do to secure venture capital.
There are plenty of interesting deals in the Done Deal section, including a celebration of FL Partners-backed Kaymed being awarded the bed manufacturer of the year award by the National Bedding Federation in Britain, beating 59 rivals. Famous in Ireland for their traditional King Koil and Odearest brands, the company is constantly innovating and expanding. It employed 185 people in 2012 and employs 300 currently in Bluebell and Kilcullen. It has had recent wins with the UK’s biggest retailer Benson and also have made in-roads into China. CEO David Moffitt is also the chairman of Folens.
There is a focus on the forecourt awards and on the Workplace Equality Index.
Rob Adams and Martin Higgins’ Focus Consulting have joined the professional firms offering EIIS investments whereby people can effectively get a tax rebate for investing in companies. Unlike some other offerings, Focus are offering investments on an individual basis where the investor can choose their investment as opposed to a pooled fund.
The monthly Connected guide is full up of technology tips for your business.
Successful Longford publican John Mahon, who owns the Pig ‘n Whistle in New York, has bought and re-opened Kennedy’s Station in Westland Row last week.
Róisín Burke previews the sale of items from Castlemartin estate being auctioned by Mealy’s.
Burke also enjoyed a read of the recently launched Coolmore Stud:Ireland’s Greatest Sporting Success Story by Alan Conway.
Sunday Independent
“Arytza, the Swiss-Irish baked goods company, has rowed back on its commitment to a €446m investment in French company Picard, which has proven extremely unpopular with shareholders. New chairman Gary McGann is to carry out a review of the company’s position on the French frozen food company and its option to buy out the remainder of the business in 2021”.
Samantha McCaughren later writes on Arytza’s woes and Gary McGann’s possible impact in his new role as chairman, while the Times notes that McGann’s appointment has coincided with a 10% rise in the share price.
Fortress, the only under-bidder in NAMA’s controversial sale of its Northern Ireland loan portfolio, Project Eagle, to Cerberus, is claiming that NAMA effectively shut it out of the bidding process. Fortress claims that NAMA did not push them on price or try to run a competitive process. NAMA claims that Fortress’ bid was below their reserve, whereas Cerberus’ was in excess of it.
Online spending by Irish consumers rose by 18% last year, while online spending on food rose by almost a quarter; according to a study by online body Ecommerce Europe. Online spending by Irish consumers is expected to reach €6.8bn this year, with Retail Excellence Ireland estimating that 60% of this will go outside the country.
Short-lived England football manager, Sam Allardyce, and London-based Irish accountant Shane Moloney, are among the investors in a new firm, Global Baby & Infant Formula Ltd, which is targeting the $2.4bn infant formula milk market in China. “China imports about three quarters of its formula from Europe and Ireland is the second biggest exporter to China”. Kerry Foods will manufacture the formula for the new company.
JLT Insurance Brokers are lobbying the government to introduce “mortgage-insurance products which would allow banks to offer higher loan-to-value (LTV) mortgages”. These products would, according to JLT, allow first-time buyers to borrow up to 90% LTV and would pay out to the banks if house prices were to fall below the loan value outstanding. While this sounds like a nice solution to allow first-time buyers to get on the ladder, it could lead to imprudent lending and pushes the problem onto the insurers balance sheets were another big fall in prices to occur.
Aercap’s CEO, Aengus Kelly, is calling for the government to make its Special Assignee Relief Programme (SARP) easier for employees to use and make the term longer – the SARP offers partial income tax relief for high-earning employees of foreign companies with operations in Ireland. The SARP is important to help attract the decision makers of the FDI companies to Ireland and is important to Ireland’s attractiveness as an FDI destination.
Irish businessman David Cosgrove “who was handed a boardroom ban amid allegations that his companies form part of an elaborate $16bn Ponzi scheme, is preparing to launch multi-million euro lawsuits against financial regulators in Mauritius and Guernsey”.
Ashford Castle in Co. Mayo saw its revenues rise 30% to €11.8m last year. This follows a $50m investment programme by the hotel’s new owners, Red Carnation. Red Carnation is owned by South African couple, Stanley and Bea Tollman. EBITDA for the hotel was c.€0.3m, however there was a net loss for the year of €23m, €17.6m of which was due to an impairment on the property from a recent Savills valuation. This impairment is described as “temporary”.
Richard Curran has an interesting piece providing a short summary of the recent PAC meetings which saw executives from both NAMA and the C&AG speak about NAMA’s sale of the Northern Irish portfolio, Project Eagle.
The Tony O’Reilly Jnr.-led Providence Resources has appointed Pat Plunkett as chairman. Plunkett is a former chairman of Tullow Oil and helped lead Tullow from a market cap of £274m in 2000 to £9bn in 2014.
Dearbhail McDonald has an excellent interview with John Dolan, director of private equity firm Cardinal Capital Group. Dolan manages a €300m fund in 50:50 partnership with global asset manager, The Carlyle Group. They are focused on the top 1% of Irish companies. Dolan is currently walking his talk with seven companies acquired/invested in since inception and is “taking companies that are growing already and try to accelerate that growth plan”. He is extolling the view that private equity can act as a growth catalyst beyond that which bank funding in isolation can bring. Furthermore, private equity can also bring experienced strategic partners to the table which can provide a network and experience that can unlock the potential in a business. It will take a number of local success stories for Irish people to really appreciate what value private equity can bring.
Recent data published by Kantar Worldpanel shows that in the last 12 weeks of sales, Dunnes Stores is now level with Tesco at 21.8% market share, with the value of its sales up 6.3% year-on-year. SuperValu still leads with 22.4%. This time last year, Tesco had the largest market share, followed by SuperValu and then Dunnes. Discounters Lidl and Aldi have markets shares of 11.7% and 11.3%, respectively.
This week Sean Gallagher meets with LittleBig founder Simon Evans. Founded in 2014, “LittleBig is a unique three-in-one bicycle that adapts to a growing child’s needs…starting as a pedal-less balance bike, the young rider propels themselves forward by pushing off the ground with their feet”. The bike can be adjusted to a taller balance bike as the child grows and eventually pedals can be added, converting it to a full pedal bike. Evans’ designs won an acclaimed international Red Dot Award and are patent-pending.
On the back page, Samantha McCaughren reports that John Magnier and his co-investor, Chinese businessman Teo Ah Khing, have been granted planning permission to begin redevelopment work on M Ryan’s, the bar adjoining the Cashel Palace Hotel. In the next phase of investment, the pair have plans to extend the 18th century Cashel Palace into a 60-room hotel.
Irish ocean turbine company, Openhydro, is facing “choppy waters” in its bid to install turbines into the Bay of Fundy as a group of Nova Scotia fisherman will seek a court-imposed one-year suspension to allow time to study the area’s marine ecology and assess any potential damage from the turbines.
Business leaders will nobly sleep on the streets next month in association with Focus Ireland’s ‘Shine a Light Night’. Those taking to the streets include Patrick King of the Doyle Group, Kevin McGillycuddy of Brehon Capital, Alan Fox of Core Media, Kevin Land of Ornua and Gareth Lambe of Facebook. Over €1.5m has been raised since 2012 to help fund services to prevent and combat family homelessness. Those who want to join can organise an office sleep-in.
Sunday Times
Health insurance companies have been billed for more than €150m since 2014, when the government changed the rules to let hospitals impose private patient charges on everyone with insurance – even when they end up on trollies. Insurance companies believe they are being taken for cash cows by cash-strapped hospitals and will be raising the issue with Simon Harris.
Brian Carey ponders the upcoming budget and thinks Michael Noonan has nailed his colours to the mast, and will skew his €1bn available pot to increased spending rather than tax cuts. Public sector pay rises will consume some of this with Gardai, teachers and transport workers already out of the blocks in negotiations or settlements.
Carey thinks hypocrisy is at play amongst commentators when it comes to NAMA; it has been lambasted for selling and not developing out the Battersea Power Station site in London, but is criticised for funding and building out sites in Ireland as this is considered anti-competitive by Irish developers.
The Food Safety Authority of Ireland (FSAI) has summoned executives from Heineken Ireland and drinks Group C&C to meetings as part of an investigation into sales in the beer on-trade market, due to concerns of their branded beers being sold under different names. C&C has already admitted selling its Clonmel larger under a different name.
Digiweb the telecoms provider founded by Colm Piercy, has hired IBI Corporate Finance to review its strategic options. Digiweb has about 31k subscribers and has been valued at up to €35m according to the Times.
Cormac Lucey thinks that although the peak of the financial crisis would appear to be behind Ireland, we still have dangerously high levels of debt as a nation. The IMF warned us in its January report “public debt levels are high and growth shortfalls are the key risk to sustainability”.
Openet, Ireland’s largest home-grown software group, broke through the €100m revenue barrier last year and is targeting significant future growth as its clients adopt new technologies. Niall Norton, chief executive, said the company had a €20m debt war chest to finance expansion.
Value Retail Dublin, owner of Kildare Village, has refused to comment on reports that the highly successful outlet retail centre is in talks with Kildare County Council about a further expansion, less than a year after opening its second phase.
AIB will announce refunds for customers who were wrongly denied tracker mortgages by the bank next month.
The London property group Meyer Bergman has sought permission to demolish Nassau House, a Dublin city centre block it bought last year for €93m, and build a new development of offices and shops. The company plans to spend €200m on the redevelopment.
Investment firm Covestone Asset Management has been put up for sale by its founder, the solicitor Donal Roche. Roche was a former managing partner of Matheson Ormsby Prentice. It is understood the business is currently loss-making.
Investors in a €90m Birmingham data centre, which include Rory McIlroy, are fighting a tax bill levied by the British tax authorities. The scheme was put together by the British investment group Harcourt Capital and also includes a list of famous footballers including Ryan Giggs and Kenny Dalglish.
Monex Financial Services, the Kerry provider of currency services to banks and businesses worldwide, paid a dividend of more than €9.3m to its founder and largest shareholder Frank Murphy last year.
Killashee House hotel in Co. Kildare, which was bought out of Examinership two years ago for €13m, has been revalued at more than €20m. The hotel is owned by Tetrarch Capital and benefited from a major capital investment programme last year.
The Revenue Commissioners are to undertake a “thorough” investigation of the profitability of so-called vulture funds, which purchased distressed loans from NAMA and Irish banks.
Abercrombie and Fitch, the youth fashion chain, has recorded reduced sales and profits in Ireland, and warned about the possible impact on the business of Brexit.
Abbey International Finance (AIF), a financial services company owned by a low profile Christian foundation, wrote off over €13m when exiting its investment in a chain of Energie gyms, which were owned by Prime Fitness. AIF drew a line under its ownership of Prime Fitness, after the gyms went into examinership for the second time in five years.
The K Club, owned by Michael Smurfit, lost €3.2m in 2014.
Former Vodafone Ireland boss Stephen Brewer has been drafted on the team advising the government on the tender for the national broadband plan. Brewer most recently worked for Brite:Bill, which was sold to Amdocs for more than €75m.
E-Spatials Solutions, a Dublin tech company backed by Dermot Desmond, lost €2.2m last year and has accumulated losses of €36.7m.
Nick Webb’s inside track this week:
– Sonia Flynn, who left Facebook recently to become VP of International sales at the streaming music service SoundCloud, could be in line for a big cheque. Spotify is said to be preparing a $700m bid for the company.
– Tony O’Reilly’s Providence Resources was down to its last €500k before pulling off an impressive €62m funding round in June.
– Waldeck, the Dublin-based wealth adviser to the stars, and the Swiss bank Edmond de Rothschild are in dispute over fees and commissions. Waldeck has secured a payment injunction of €5m against the bank as the long running dispute escalates.
– Dalton Philips, the former head of Brown Thomas and British Supermarket chain Morrisons, has joined Boston Consulting.
– Nearly €40m exchanged hands in the Orby horse sale in Goffs last week.
Gavin Daly has an interesting piece on the craft brewing sector and the large beer companies’ tactics to “tap” into the micro brewery market.
Ex-Leinster rugby player Rory Moloney and chief executive of Aon is the subject of this week’s Niall Brady interview, as usual a very interesting read.
Sandra O’Connell has a good piece covering some of the innovative tech solutions emerging in Ireland’s agri-tech sector. Emmet Savage’s Moocall, an app that helps keep cows safe during child birth, has already 4k customers; the business had raised €2m to date, its investors include Michael Stanley of Cairn Homes and Michael Smurfit as investors. Other technologies covered are Fabien Peyaud’s Herdwatch and Gareth Devenney’s Farmflo.
23% – The decrease in M&A activity for the first half of 2016, according to a report by @BDOIreland. @IndoBusiness
c. €700m – The current value of business tourism in Ireland. @IrishTimesBiz
7% – The projected unemployment rate by the end of 2018, according to @NERI_research @examinerbiz
1.7% – The @WTO’s projected growth in global trade for 2016, down from its April forecast of 2.8%. @IndoBusiness
€273m – The aggregate loss made by motor insurers in Ireland in 2015, according to data from @centralbank_ie. @IrishTimesBiz
4.7% – The month-on-month decline in retail sales for the month of August, according to @CSOIreland. @IrishTimesBiz
700k – Estimated reduction in the number of barrels per day of oil supplied as a result of Opec’s agreement to cut output. @IrishTimesBiz
30% – The projected decline in London office values by the end of 2017, according to @DeutscheBank. @IrishTimesBiz