AIB is said to be looking at a ground breaking solution to its mortgage arrears problem which meets the objectives of clearing the debts off its balance sheets and giving the homeowner a chance to long-term rent or buy the house at current market rates. Irish Mortgage Holders Association, headed by David Hall, is expected to be the partner to help them execute.
David Daly of Albany Homes, who exited NAMA early by selling off his Louis Vuitton building in London, is the suspected author of a new bestselling novel, Grange Abbey. The novel chronicles the lives of three generations of the fictional Bannon family through the boom, bust and everything in between.
There is a Red C Poll with the results as follows: Fianna Fáil 28% (+2%) Fine Gael 24% (-) Sinn Féin 18% (+1%) Labour 6% (-) Greens 3% (-1%) Ind Alliance 2% (-1%) Solidarity-PBP 4% (-) Other Inds 10% (-3%) Renua 1% (+1%) Soc Dems 4% (+1%)
Varadkar was marginally more popular than Coveney for people's preference to be the next leader of the country.
"Staff at AIB should be incentivised as part of plans to return the state-controlled bank to the stock market, according to the head of the union representing the majority of its staff." The head of the Irish Bank Officials Association, Larry Broderick, is interviewed in the Business Post.
Planning rules that favour locals over others in rural areas are to be scrapped to comply with EU rules. The Minister for Housing is set to comply with a European Court of Justice ruling that scrapped a law allowing only local people build in the Flemish region.
Baker Tilly Hughes Blake is the examiner for Com-Plas Packaging Limited, a packaging and branding company based in Naas. The firm managed to gain protection via examinership against an attempt by Goldman Sachs to appoint a receiver.
There are two articles about Independent News and Media in light of its admission in its annual report that it was in breach of corporate governance rules. The article reports that currently only three of the nine board members are independent as Allan Marshall and Triona Mullane were classified as non-independent due to their links to Denis O'Brien. Regulations require at least half to be independent. The AGM has been postponed by four months as everything gets sorted out.
Michael Maye has plans for a €60m covered market in Galway city, similar to Covent Garden in London, the English Market in Cork and similar ones in Krakow and Budapest. Davy Private Finance is raising the money. The 1.5-acre site incorporates the Connacht Tribune offices which Maye also acquired. It will also contain a boutique hotel.
Dublin Airport Authority staff rejected a pay productivity deal proposed during the week. Effectively, they were offered a 4% pay rise in return for productivity improvements. There is a risk that industrial action will ensue.
There is an article on how legislation in relation to corruption is going to be tightened up.
Feargal Quinn writes an article in support of the Minister for Jobs, challenging the Central Bank in relation to how it deals with companies looking to set up in Ireland.
The parcel delivery software company Scurri, backed by Scott Weaver Wright and Pa Nolan and run by Rory O'Connor in Wexford, is setting up a base in the UK to protect itself from Brexit. Its services are used by eBay, Amazon, Asos Xara and many others in the online retailing space.
Merrion Fleet is planning to add 20 Teslas to its fleet. It’s understood there are 30 Teslas in Ireland owned by such luminaries as Gene Murtagh, Bobby Healy and Anna Scally. The first Tesla store opened in Sandyford last week.
Paul Keenan and Eamonn Hayes' boutique corporate finance firm Capnua is reported to be engaged by the management of Mercury Engineering to raise funds to table a bid for the company. The family of the late founder Frank O'Kane own up to 70% of the business.
Two Chinese companies are said to be looking to take over San Leon Energy. Toscafund is the key shareholder (owns just under 60%), run by Martin Hughes, and it has appointed merchant bank Hannam and Partners to look at its options.
Both Eamonn Duignan and NAMA have lodged proceedings against each other and a case is due to be held in the High Court soon.
XSellco, owned and run by Ray Nolan, is planning to open an office in the Asia-Pacific region later this year.
The acquisition of Newsaccess by Kantar is being investigated by the Competition and Consumer Protection Commission.
Recently founded delivery company WeBringg is expanding into Australia. It won a breakthrough contract with JustEat here last year and is growing fast. Alan Hickey and Sean Murray co-founded the company in 2016. It handles deliveries for retailers who do not have their own drivers.
Jam Media has just raised €7.2m for its latest show, Becca's Bunch. All of the global stations seem to have signed up for Becca's Bunch which looks like a great success.
Róisín Burke interviews Jamie Heaslip about his business interests, including pubs Lemon & Duke and other tech and wellness investments. Other investments include Urban Volt, Pointy, C7 brands and Lovin’ Group. He quietly exited the Bear restaurant.
Computing specialist Auxilion has signed a contract with Applegreen to overhaul its IT systems.
"German logistics firm Dachser has acquired an 80 per cent stake in Johnston Logistics, the Dublin-based firm run by brothers Albert and Ivan Johnston with annual turnover of €24m."
There are focus pieces on ICT in Colleges, ERP, An Post Smart Marketing Awards, Management matters and the importance of British-Irish trade.
There is a special in the Money section about Ireland's pension time bomb which is worrying.
The DCU Family Business Centre is said to be likely to follow the route of the Kellogg Family Enterprise Centre in US and get one big patron to sponsor. The centre, chaired by Paul Keogh, is very progressive and is linked into the best practices around the world for how to deal with all issues faced by family businesses.
365 Data Centres, the tenth-biggest co-located data centre company of its type in North America, has been bought by an investment group including Colm Piercy's Chirisa Investments, Lumerity Capital and Longboat Advisors. Deal terms were not disclosed, but the Sunday Independent reports that the deal could be worth in the $100m region. The deal will see Piercy become chairman of the company and Bob DeSantis will become its new chief executive officer.
An Post's CEO, David McRedmond, has confirmed that the company plans to fight to retain the contract to collect the TV licence fee, which is reported to be valued at €12.5m. Services company Capita and Cork-based Abtran are two other operators that are likely to tender for the contract. TV licence fee evasion is currently at c. 15% and is costing the broadcast sector up to €40m per year.
PropertyEU magazine, a property industry publication company, has acknowledged the acquisition of Battersea Power Station as the "development deal of the decade" and the acquisition of Project Jewel, a portfolio of prime retail assets which includes Dundrum Town Centre, as the "debt deal of the decade".
Richard Curran's Pieces:
- Curran commends the Department of Housing's announcement which detailed the over 700 state-owned sites which are being made available to build 50k homes. Developers will get access to this land for a "knock-down" price and will deliver social housing in return. Curran points out that it is an elaborate way for the State to avoid building new public housing itself and that these deals will need to strike a balance between giving away valuable sites for too little and incentivising developers.
- Glanbia has posted a year-on-year increase in group revenue of 9.6% for the first quarter. However, Glanbia's performance nutrition division's first quarter revenues were down 0.2% and volumes were down 3.1% amid a "continued decline" in Glanbia's contract business. Curran thinks this is likely due to overcrowding in the US market.
- One of Greencore's largest customers, Tyson Foods, has purchased a huge sandwich operation of its own. Tyson is reported to be spending $3.2bn buying US-based sandwich maker AdvancePierre Foods which has contracts with the US military and churns out one million sandwiches per day. Greencore’s share price fell 7% on the news.
- Tullow Oil's outgoing chief executive and founder, Aidan Heavey, is reported to be taking on the role of chairman for the next two years. Despite it going against corporate governance best practices, this approach is being taken on the basis that the group is going through a time of huge transition and he is best placed to have a further role in steering the company.
Simon Harris, the Minister for Health, is said to be traveling to up to eight European capital cities in an effort to bid for the relocation of the European Medicines Agency (EMA) to Dublin post-Brexit. The EMA houses more than 900 staff and is said to be one of the most sought after relocations following Brexit.
Irish wholesale gas prices have gone up by 25% since last April and may increase further due to the closure of Rough Storage, the UK's largest gas storage facility, according to Vayu's latest monthly energy report. The report also states that wind energy accounts for c. 18.2% of Ireland's overall electricity generation.
The Sunday Independent reports that multiple bidders have emerged to compete for the 8% stake in the Blackrock Clinic held by US developer John Flynn. Larry Goodman is said to be the main contender.
FarmIreland .ie, the Independent News & Media's new agri-digital content and advertising product, has performed strongly since inception and now has 500k unique users a month and the app has been downloaded by over 6k people.
Westmount Energy, an oil and gas investment company backed by ex-Cove Energy chief executive John Craven and Cove's former chairman Tom O'Gorman, is seeking to raise as much as £764k in working capital via a share placing in order to progress exploration and investment opportunities in the emerging oil and gas province of Guyana-Suriname Basin.
Dublin For All, a lobby group consisting of the IFSC, The Point Village, Live Nation, the National Convention Centre, Bord Gáis Theatre, Temple Bar Company and the Docklands Business Forum, has been set up to oppose Dublin City Council's new traffic measures on the North and South Quays which would eliminate certain turns and close off routes to shops, hotels and car parks, etc.
The Consultative Committee of Accountancy Bodies-Ireland (CCAB-I) has issued a letter to Revenue chairman Niall Cody over a letter campaign the Revenue carried out which targeted 500k self-employed people. The CCAB-I's issue revolves around the wording of the letter which has led to its members "encountering an unprecedented volume of communications from their clients who are unnecessarily concerned that their tax returns are incorrect".
"According to Bloomberg's ranking of billionaires, Amazon CEO, chairman and founder, Jeff Bezos, had a total net worth of around $80bn (€74bn) after the retail behemoth reported a net income of $724m (€664m) for the first quarter of this year."
Kendal Nutricare, a baby food company founded by Ross McMahon, is on target to hit £12m in revenue this year and is aiming to generate revenues of £31m by 2021. McMahon, a Monaghan-born entrepreneur, acquired a former Heinz baby food factory in Cumbria for just £1 in 2015. Since then, McMahon has turned the business around, generating revenues of £7.5m and saving 90 jobs in the process.
- Goldman Sachs’ co-head of investment banking, Richard Gnodde, has said the group plans to start moving London-based staff and operations to new or expanded offices inside the EU next year, as it prepares for the UK to lose access to the single market post-Brexit.
- Japanese Prime Minister Shinzo Abe has asked Theresa May to ensure a smooth Brexit to allow Japanese companies to continue to operate as Britain exits the UK. The UK is reported to be the second most important destination for Japanese investment after the US.
- Pret a Manger, the coffee and sandwich chain, is seeking to increase the number of Britons working in its UK shops to cushion it from potential damage if EU workers stay away after Brexit. 65% of Pret's 8k workforce come from EU countries other than Britain.
Tom Maguire has a piece this week discussing how we must level the playing field for investors amidst the rent crisis. Among other things, Maguire suggests bringing in an income tax credit for the VAT paid on the acquisition of a property or incurred on properties constructed with a view to rental, accelerating the tax deduction for expenditures on fixtures and fittings to 5 years (currently at 8 years) and a standard rate of taxation on long-term residential leases.
Dan O'Brien reports this week on the dire future food exporters are facing post-Brexit. The home grown export sector is hugely focused on the UK and the potential tariff and non-tariff barriers that may arise post-Brexit will have major implications. His argument is supported by the following statistics: - In the 2011-2015 period, Britain has absorbed just under 50% of Ireland's food exports. - Of the top 10 exports by indigenous companies, only one item is non-food. Of the 9 food export items, meat products account for 5, with the balance being other kinds of food products. - Beef accounts for almost 25% of the value of Irish companies' exports and is the single most valuable product sold abroad by indigenous companies. In 1996, beef accounted for 14% of Irish company exports, meaning it has become more dominant over the last two decades. - "Prepared preserved meat, meat offal and blood" is the second most valuable export, accounting for 8% of 2015 indigenous exports
Samantha McCaughren's Ergo Piece:
- Global proxy advisers Glass Lewis has said it does not approve of the scale of Ian Curley's exit package from Smurfit Kappa. Curley received a year's pay, his highest annual bonus in the last three years and the cash value of any benefits.
- Pascal Conroy, the brother of former Merrion Capital boss John Conroy, is reported to be moving on after more than 15 years with Merrion Capital. Pascal is said to be joining John's new venture which will bring together tech and health and is linked to former C&C boss Maurice Pratt, retired Olympian Eamonn Coghlan and Chris Horn, the co-founder of Irish software company Iona Technologies.
This week's focus piece is on building materials giant Kingspan's recent performance and the challenges it faces ahead.
This week's interview is with Peggy Johnson, a vice president of business development at Microsoft.
FBD is the latest company to face a negative recommendation on executive pay from the shareholder advisory firm covering its shares, in this case ISS. It cited “poor disclosure practices” in the remuneration report, including a lack of information around the targets for bonus payments to CEO Fiona Muldoon as the reason for rejection.
After reforms by the government to the mortgage-to-rent scheme, which now includes a mechanism for private investors to come in and acquire the properties and rent them back to the borrowers, AIB is reported to have identified up to 750 distressed mortgage customers who could be eligible. The scheme was launched in 2012 and up to March this year, only 235 cases in total had been approved.
NAMA is reported to be preparing to bring Carton House hotel to the market in the next couple of months. The latest accounts, 2014, show the hotel had sales of €16.4m and profit before interest and rentals of €1.55m.
A new report to be published by the Paris-based Financial Action Task Force is expected to have identified several weaknesses in our financial system which could allow criminals and terrorists to use Ireland to gain access to the international finance system.
Brian Carey’s piece:
- Carey downplays Trump’s new tax plan as more a “statement of ideas” rather than a ready-to-go plan. The plan released last week ahead of Trump’s 100th day in office ran to less than 250 words. Carey identifies US pharma manufacturing companies based in Ireland as the most likely to be affected by any tax changes, however these effects are likely to be felt over the long-term rather than short-term in Ireland.
- Irish households have more money on deposit with Irish banks than they have loans outstanding – there is €9.5bn more in household deposits than household loans. Carey highlights that this is a stark turnaround from early 2009, when households had €53bn more in loans with Irish banks than they held in deposits.
- Carey questions whether Green REIT is tapping into a structural change in the retail market and notes its recent sale of Blanchardstown Shopping Centre and the new building of units by Green REIT in its logistics park by Dublin Airport.
The founders of Steripack, Garett Moore, Barry Moore and Aidan O’Brien, have acquired the former Imperial Tobacco factory in Mullingar for €4m through a corporate vehicle Speakerdale Ltd. Steripak was sold last year for a reported €70m.
Retiring Chartered Accounts Ireland boss, Pat Costello, is reported to have been paid €217k as a retirement gratuity. He will be replaced by Barry Dempsey, former head of hairdressing business Peter Mark.
The creditors of BMSS, the security company which worked at Shell’s Corrib gas pipeline in Mayo, are to receive a significant write down on the money owed to them as BMSS has successfully exited from examinership. BMSS was founded by former soldiers Terry Downes and Jim Farrell. Downes exited the business in 2013.
Irish-based Valeo Foods has acquired Italian food business Dolciaria Val d’Enza, a maker of Valdenza tarts. No price was reported. Valeo, owned by Capvest, had sales of €446m and profits of €25m to March 2017.
All three papers report of plans by listed pharma investment business Malin Corporation to raise €30m through a placing of shares. Malin has raised €400m to date and has made 18 investments.
Bill McMorrow, boss of property investment firm Kennedy Wilson, received a $10m bonus last year, bringing his pay up to $18.9m, while Kennedy Wilson’s European head, Mary Ricks, received $14m, including an $8m bonus.
The investment funds which acquired mortgage books from Irish banks are using the bond markets to realise cash by issuing bonds backed by the cashflows received from the underlying mortgages. Earlier this month Lone Star refinanced €419.8m and Mars Capital refinanced €332m through bond markets.
Irish retail investors are moving away from holding their cash on deposit in banks and back to using investment managers in search of bigger returns. Irish Life has reported a 46% rise in customers signing up for its investments funds over the past year.
After completing the redevelopment of its website and launching its new app, Ryanair is reported to be aiming to develop an online marketplace and become the go-to place for all travel spending, the “Amazon of travel”. The initiative is being led by the airline’s chief technology officer, John Hurley. The airline is looking to partner with travel technology businesses and will also consider equity investments and acquisitions.
ATA Group, a Cavan-based tools engineering business headed by Peter Cosgrove, has raised €12.5m in investment. Investors include BDO Development Capital, Investec and a number of private investors. In 2015, ATA reported revenues of €65.5m, EBITDA of €14.1m and net profit of €3.9m.
Owners of the Home Instead Senior Care master franchise in Ireland, Michael Kearney and Ed Murphy, have sold a reported 60% of the master franchise to outside investors including their Swiss affiliate and former head of stockbroking at Davy, Tony Garry. Garry will join the board of the business. The value of the sale was not disclosed.
Gavin Daly dedicates a full page to Irish tech company Intercom and a secret event it is running in 9 cities around world where it will tell the story of its development. Intercom is currently valued at $500m, but tipped by some with the potential to reach a $10bn valuation.
In this week’s long interview, Philip Connolly speaks with Fastway chief Bobby O’Keeffe. "O'Keeffe invested in the Fastway franchise 15 years ago and has just bought out original shareholders Gerry Riordan - his cousin - and Andy Hennessy in a deal worth in the region of €30m. The private equity company MML Growth Capital Partners Ireland bought a minority stake in Fastway, while AIB also backed the buyout of the company. Already a shareholder, O'Keeffe reinvested and took control."
Sandra O’Connell interviews Tom Kelly of TradeCert for this week’s How I Made It piece.
Nick Webb’s Inside Track:
- Former Paddy Power CEO Andy McCue, who is now CEO of the Restaurant Group in the UK, is ringing in the changes at the executive table of the embattled company. He has dropped the finance director and is in the market for a candidate with “a different skill set”, brought Lucinda Woods from Paddy Power Betfair in as director of strategy and brought in Murray McGowan from Costa as head of leisure.
- After LafargeHolcim’s CEO stepped down during the week amid controversy, Webb speculates about whether CRH’s Albert Manifold may get poached for the job. Manifold knows the business well after acquiring €6.5bn worth of assets following the merger of Lafarge and Holcim.
- Former Ireland international Chris Hughton’s investment in London property is reported to be benefiting from rising London house prices, with this investment company holding property worth €975,000.
- Former Aer Lingus boss, Christoph Mueller, has applied for planning permission to level his Howth home and build a new house double the size of the last. Mueller, who now works with Emirates, is reported to be linked to the CEO role with Etihad.
- John Aherne and John Daly, both former Irish Army, are looking to raise €1m to bring technology for helping you to aim better when shooting into development.
@RenatusCapital tweets this week:
$22.3bn - Amount of foreign direct investment in Ireland for 2016, a year-on-year decrease of 88.1%, according to @OECD. @IrishTimesBiz
40% - The percentage of Ireland's corporate tax receipts that is paid by just 10 firms, according to @RevenueIE. @IrishTimesBiz
27k - Number of homes being built or completed in London that have gone unsold, the highest level since 2009, according to @MoliorLondon.
1.5% & 1.6% - Projected growth in the German economy for 2017 and 2018, respectively, according to its federal government. @IrishTimesBiz
€240bn - The amount spent by Chinese tourists last year, a year-on-year rise of 12%, according to @UNWTO. @IrishTimesBiz
920k - The number of people employed in the SME sector in Ireland. @examinerbiz
2,076 - Number of new homes built in 2016, well below the Government's estimate of 15k according to the Building Control Management System.
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Mark Flood | Director | Renatus Capital Partners
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