The Minister for Housing, Eoghan Murphy, is planning a new affordable housing scheme for the upcoming budget. The new scheme will bring in recommendations made by the Housing Agency, which includes providing homes on state-owned land. The state has more than 700 available sites around the country available for development. The government may look to waive site costs for developers and seek to have house prices and rents on the sites capped to an “affordable” level - Murphy’s reported definition of affordable is understood to be a max of three times income.
Stephen Kinsella writes about those in the economy being left behind in our recovery - recent homelessness figures are the highest ever recorded.
According to Trinity College and ESRI economist Paul Gorecki, the government has overstated its savings from medicine deals with the drug companies by €310m.
Storyful, the social media monitoring and intelligence company founded by Mark Little and sold to News Corp for €18m in 2013, has hired a new CEO, after the departure of the previous CEO Rahul Chopra. The company has yet to announce the name of the person hired.
US-backed Passage Healthcare is looking to become a leading player in the Irish nursing home market, with a target of a potential 1,200-bed group. Passage is backed by Andy Turner and William Lasky - who run a 10,000-bed nursing home group in the US - and Irish lawyer Ronan Collins. The Irish operation will be led by Sheila King. It is looking at an Opco-Propco model whereby Passage would manage the operations but rent the property from a property owning company.
Independent News and Media non-executive director Allan Marshall is leading a cost-cutting and new revenue opportunities review of the company.
Fashion blogger Pippa O’Connor’s jeans line has sold over 40,000 pairs of jeans since launching from a pop-up store in Dundrum earlier this year according to the Business Post. A new pop-up store has opened in Mahon Point Shopping Centre in Cork.
Dublin-based start-up DropChef, which delivers ingredients and cooking instructions to homes across Dublin, Meath and Kildare, is to expand its operations into the North by the end of the year. Expansion into Britain is planned afterwards. The company was founded in 2014 by Roman Grogan, Ryan Scott and Sam O’Byrne while in college in DCU.
The state may face a fall in CGT receipts after next year as the recession-era CGT holiday initiative matures next year. The initiative will see investors who purchased a property between December 2011 and December 2014 pay no CGT on the sale of the property so long as they owned it for more than seven years. The first properties eligible for the relief can be sold from December 2018.
In an analyst note, Citibank has warned that Brexit may slow down the recovery of Irish banks as the SME sector deals with the fallout, with Irish exporters and the lenders particularly exposed.
The departure of Breon Corcoran from Paddy Power Betfair is given plenty of coverage in each of the papers this morning. Paddy Power Betfair has defended its handling of the planned departure of chief executive Breon Corcoran and insisted it “strictly adhered” to its disclosure obligations as a quoted company. Almost £570m was wiped off the value of the gambling group last week after it announced Corcoran’s departure followed by an unexciting set of results. The share price peaked at €137 in January 2016 and fell below €80 last week. The industry is facing a headwind of increased regulation and slowing growth in the market size. The company was forced to announce that Corcoran was leaving after Sky News reported last week that recruiters had been hired to find his successor.
Consultancy firm Accenture earned €11.6m from An Garda Síochána last year, up from €8.8m the previous year. An Garda Síochána spent €15m last year on external consultants for its IT systems.
Irish solar energy developer BNRG Renewables is bringing its British solar farms to the market with an estimated value of €29m for the 20 megawatts of assets. After the sale, BNRG will reportedly focus on the US and Irish market. BNRG last week secured permission of a 27 hectare site in Co. Wicklow.
There is a two-page report on the growth in Ireland’s solar energy market. The eight main players targeting the Irish market are Wexford Solar, Amarenco Solar, Power Capital Renewable Energy, BNRG Renewables, Gaelectric, JBM Solar Developments, Highfield Solar and Solar 21. The Sunday Independent reports that, according to analysis by PHR Planning, there have been 225 planning applications lodged since June 2015. Prior to that, there were no applications in the system. The average size of the schemes is c. 10 hectares, Cork is the county with the highest number of applications at 38 and Highfield Solar is the most active company with 27 applications. The cost of capital equipment is falling fast and the economics of solar begin to make a lot of sense if the government’s proposed renewable energy price support scheme is enacted. It has been promised for a long while but has not yet been introduced.
Former Central Bank director Peter Oakes and Swiss lawyer David Bundi will join the board of regulatory intelligence tech company Corlytics.
Decobake liquidator Declan de Lacy of PKF O’Connor Leddy & Holmes has received an interim court injunction against Decobake owner Paul Coyle over “unlawful and defamatory conduct”. The Sunday Times reports that de Lacy has succeeded in getting an injunction stopping the company’s directors from interfering in the business.
Outgoing CEO of Kerry Group Stan McCarthy has said that the company has the financial capacity to make acquisitions as opportunities arise. Its debt-to-EBIT ratio is now at c. 1.3 times, down from 2.0 times at the end of 2015 after it made one billion worth of acquisitions, giving it significant balance sheet capacity to fund acquisition. Brian Carey of The Sunday Times reports that Edmond Scanlon will take over as chief executive of Kerry Group on the 1st of October.
Irish telecoms software company Opennet is appealing a patent ruling to the US Supreme Court. Israeli company Amdocs has accused Opennet of patent infringement.
Ian Kehoe reviews the bounce back in the Irish hotel market, while there is also a piece on the rise of the five-star manor hotel market in Ireland.
In a sign of a step-up in US private equity funds’ desire to move on from their investments in Ireland’s distressed debt market, the number of cases they have brought to the courts has jumped. According to The Sunday Business Post’s research, 27.4% of all summary judgement applications to the courts last year came from these special situation funds, up from just over 10% in the previous year. The most active of these are Goldman Sachs with 105 actions since January 2016 and CarVal with 183 for the same period.
There is a two-page special report on the south-west region, analysing current and future prospects for the region.
Leanna Byrne interviews Deirdre McGlone and Marc Gysling, owners of Harvey’s Point Hotel in Donegal.
Michael Brennan has a profile on Michael and Danny Healy-Rae.
A new start-up hub and co-working facility with space for 200 people will open on Dawson St and be run by Dublin Business Innovation Centre (Dublin BIC).
The Sunday Independent reports that the IDA is keen for First Derivatives, an AIM-listed company led by Brian Conlon, and other Northern firms to expand in the Republic to serve banks and financial institutions that may relocate operations post-Brexit. Sales at First Derivatives rose 30% to £152m last year and it is reported to be in final discussions to acquire a new 0.75-acre site in Newry, as well as being set to become the lead tenant at The Weaving Works in Belfast.
Patrick O’Sullivan, Conroy Gold’s largest shareholder, is hoping to come to an agreement that would see the company’s founder, professor Richard Conroy, remain on the board as its chairman. The news follows the decision to remove six out of the nine directors of the company at an extraordinary general meeting that was held at the beginning of August.
According to Kenny Jacobs, Ryanair’s chief marketing officer, the ideal outcome for Ryanair’s non-binding offer on Italian carrier Alitalia is a “hybrid deal” whereby a long-haul carrier would take over Alitalia’s long-haul operations and Ryanair would operate many of the short-haul routes to feed transatlantic and other flights. It’s reported that Ryanair has a 30% share of the Italian market.
Paul Sommerville writes on the upcoming Jackson Hole gathering where Mario Draghi and Janet Yellen are both due to speak. Since 2008, Central Banks have purchased $11trn in assets through quantitative easing and both Draghi and Yellen will attempt to explain their exit strategies from these policies.
Elon Musk’s Tesla has increased its bond offering by $300m to $1.8bn as it seeks financing for the production of the Model 3. It’s reported that the eight-year bond will have a yield of 5.25%.
Since the establishment of the vacant site register earlier this year, Dublin City Council has found 385 sites in Dublin city which are deemed suitable for housing and regeneration which have been idle for more than a year. The register is being established in preparation for the government’s 3% vacant site levy which is due to come into force in January 2019 and could see funds, developers and the state be held liable for millions of euro annually.
Transfermate co-founder and CEO Barry Dowling is said to be leaving the business following an agreement to sell his shares. It isn’t known who has bought his stake in the international payments company.
The Selfridges Group is reported to be investing €4m into Arnotts in order to enhance the group's store, as well as boost its online presence and IT capabilities.
“Zamano shareholders can expect to share €5.3m in cash, unless the company finds a suitable investment or is subject to a reverse takeover. The company will become a cash shell after agreeing to sell its operations to its management team of Brian Gilsenan and Michael Connolly, for €1.”
GirlCrew, the global network for women to make new friends and engage in professional networking, is launching an international app this week as it targets growth in the US. The company was founded by Elva Carri, Pamela Newenham and Aine Mulloy, is Enterprise Ireland-supported and has over 100k members across 46 cities worldwide.
The Sunday Independent reports that China’s Hainan Airlines, China’s 4th largest carrier, owned by the HNA conglomerate, is close to agreeing a direct scheduled flight from Dublin to Beijing for the upcoming winter season. The direct route will allow Ireland to tap the c. $110bn that Chinese tourists spend in overseas destinations.
SoundCloud, the Berlin-based digital music service, is set to receive $170m in follow-on capital from Raine Group and Temasek Holdings in order to keep the company afloat. The new funding round values the company at $150m, compared to the $700m valuation it was said to have received last year. Kerry Trainor, the former head of Vimeo, is being brought in to replace Alex Ljung as CEO and the company is shifting its business strategy to focus on selling more tools for artists, podcasters and other content creators to share material online.
Bank of England policy maker Michael Saunder has said the decision to leave the EU means the UK economy will grow “several percentage points less than it otherwise would do… over a long period of time”.
The performance of UK exports pushed the trade deficit higher in June as goods exports fell 4.9% month-on-month, while imports were up 1.5%. The data from the Office for National Statistics is eroding hopes of a currency-driven rebalancing of the economy.
This week’s interview features Neville Isdale, the owner/chairman of CHQ Dublin, former CEO and chairman of Coca-Cola Beverages Plc in Britain and founder/chairman of EPIC, the Irish Emigration Museum.
Orla Moran, the general manager at Irishjobs .ie, has a piece on how we must do more to land Brexit jobs. Although she cites a recent EY report which ranked Dublin as the number one destination for UK-based financial services companies relocating post-Brexit, she highlights how we are short on houses, lack a fully developed national transport system and have a high cost of living within Dublin city.
Gavin McLoughlin’s Ergo Piece:
- A new survey by recruitment company Prosperity shows that the lack of supply and high cost of accommodation in Ireland is jeopardising the international supply of tech talent. In 2016, Prosperity had a rejection rate of 15% on job offers to candidates living abroad; that figure has risen to 30% so far in 2017 with many citing lack of quality affordable accommodation as the reason.
- McLoughlin questions whether the agreement by Glanbia’s Co-operative to buy 60% of Glanbia’s Dairy Ireland arm last February was a wise decision following the latest set of half year results that show a 2% decline in margin and a 40% year-on-year decline in EBITDA. Meanwhile, Siobhan Talbot, Glanbia’s CEO, has been allowed to focus on the company’s high margin performance nutrition and infant formula products.
Proxy firm Institutional Shareholder Services (ISS) has given a clean bill of health to Independent News and Media (INM) ahead of its annual general meeting later this month, despite a period of boardroom discontent at the company. ISS has recommended that shareholders pass all resolutions put forward by INM. Robert Pitt, the company’s chief executive, said last month that he may vote against certain resolutions, one of which is supposedly the re-election of Leslie Buckley as INM chairman.
Brian Carey’s agenda piece:
The National Transport Authority (NTA) has selected British bus company Go Ahead to operate approximately 10% of Dublin Bus’ network, following a competitive tender process.
Marlet Property Group, a development company backed by fund manager M&G, has submitted plans for a 10-storey office block in Dublin city centre that would accommodate 3k workers. The company plans to demolish the former Screen Cinema and the adjacent nine-storey College House in Townsend Street to make way for the 25k sq. m. tower. It is expected to cost €70m to develop the site.
Cormac Lucey reminds us that the current global economic upturn has been running since 2009 and, at more than 8 years, is pretty long in the tooth compared with previous upturns. Lucey makes the point that only two of the last 60 recessions have actually been predicted in advance by economists and that is unlikely to change.
Hauliers and the country’s largest tyre distributor Midland Tyre Services have labelled the introduction of a proposed scheme to put an environmental disposal levy on lorry tyres which will add €11 to the cost of a tyre as “deeply flawed”, “damaging” and “needless”.
The Disney shop on Grafton Street has just posted its first profit after four years of consecutive losses. The retailer posted a pre-tax profit of €200k in the year to September 2016.
East Coast Bakehouse, the Irish biscuit business founded by husband and wife Michael Carey and Alison Cowzer, has raised a further €2m to invest in equipment and product development. The funding came from existing investors, which include Ion Equity co-founder Neil O’Leary, Suretank founder Patrick Joy, former Kellogg's executive Stephen Twaddell and the founders of the Lily O’Brien’s chocolate company. Enterprise Ireland also invested a further €550k, having previously invested €1.7m.
Pageant Holdings has raised its stake in Providence Resources, the quoted oil and gas company, to 8.25%, following a sharp drop in its share price.
StitcherAds, an Irish advertising software company, has raised €1.5m in venture debt from Columbia Lake Partners, a British venture fund.
British chocolatier Hotel Chocolat is to open its first Irish store this year and has agreed a lease in Dundrum Town Centre.
Bartra, the property company headed by former Treasury Holdings boss Richard Barrett, is about to acquire an apartment block in Dublin’s inner city, the Culvert Apartments on Pim Street.
Profits at Irish tour company Paddywagon were €1.1m in the year to the end of October 2016.
Staff at Dublin-based aircraft lessor SMBC earned an average of $399k each, as staff costs at the company stood at $64.7m in the year to the end of March.
ESB Telecoms, a subsidiary of the state electricity company, has signed a deal with an American firm, Silver Springs Network, to provide a national internet of things (IoT) network.
Sammon Contracting, a Kildare building group that has state contracts to build schools, made €1.3m profit last year. Neil O’Leary, co-founder of Ion Equity, owns 40% of the company which was set up by Miceál Sammon.
Malin Corporation, a listed life sciences investment group, will take a hit on its investment in US company Melinta Therapeutics, which is merging with Cempra, a Nasdaq-listed group. Malin has invested €47m in Melinta but its 9% stake in the merged group will be worth about €30m according to stockbroker Davy.
Nick Webb’s Inside Track this week:
- Derek Richardson, who sold 123 .ie to RSA for €82m in 2010 and subsequently acquired the Premiership rugby club Wasps and invested €13m in the club, has just acquired a Treasure Island themed mansion in Dorsington in the UK.
- Danuta Gray, who is interim chairman at Aldermore, the UK “challenger bank” which is owned by private equity group AnaCap, has announced results showing a 32% jump in lending to the small and medium-sized enterprises, while lending to the buy-to-let sector also rose.
- Bono is one of the co-founders of the Rise social investment fund, which plans to raise $2bn to buy equity stakes in companies and start-ups that seek to improve the lives of those less well off in the developing world.
- Actavo, formerly Siteserv, has done deals with Arsenal and West Ham to provide fencing “perimeter control solutions” for their home matches.
This week’s chief executive interview is with Tim Houstoun of Global Shares, an international provider of software and services for employee share schemes.
Sandra O'Connell gives some advice to the increasing number of foreign entrepreneurs opening businesses in Ireland on where to access finance.
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