In the background to the difficulties that Mayo Renewable Power has encountered with finance are problems that could affect many other Irish businesses.
The projects’s US backer, Weichert Enterprises, has provided €90 million of the €180 million required, €10 million more than it originally committed. However, a number of factors conspired to ensure that its three lenders, AIB, Ulster and British bank, Barclays, did not contribute any of the €118 million that they originally signed up to provide.
Barclays pulled out earlier this summer because of the uncertainty surrounding the UK vote to leave the EU. All three banks had to sign off on the company’s decision to change the supplier of a boiler, a key component for its proposed electricity generator in Mayo, and this delayed funding. A lawsuit in the US further compounded its problems.
Commentators say that one of the consequences of the financial crash and subsequent downsizing of the banks eight years ago was the loss of expertise needed to lend to projects such as the renewable power plant that the company is building.
Lending to utilities is a specialised business, normally done by teams within each bank that have built up expertise over a period. As the Irish lenders effectively shut up shop in the closing months of 2007, those teams left, taking their expertise with them.
The banks are only now rebuilding those teams, meaning that big ticket projects, with the potential to deliver real wealth and jobs to the country, could face delays getting finance here, or will have to look abroad.
The consequence of their having to go abroad is, of course, that some of the wealth they create will end up gracing someone else’s balance sheet, instead of being recycled back into the Irish economy, where it belongs.

Banks lacking expertise in lending to utilities


Mayo Renewable Power’s difficulties are problems that could affect many businesses


An infill ready-to-go site for three high-end houses in upmarket Rathmichael in south Co Dublin is fresh to the market this week at €2.125 million through agent Knight Frank.
The 2.23-acre site is currently occupied by El Dorado, a large modern house extending to 241sq m (2,594sq ft). There is planning permission till August 2018 for the retention of El Dorado on 0.46 acres and the construction of three five-bedroom detached houses of 394sq m (4,241sq ft) on site areas ranging from 0.35 to 0.44 acres.
This site, zoned Objective A “to protect and/or improve residential amenity” under the Dún Laoghaire Rathdown County Development Plan 2016-2022, has access to both Quarry and Ferndale roads.
These give easy access to the M50, N11, Shankill Dart and the Luas Green Line at Brides Glen in Cherrywood.
There should be keen competition for this site among developers given the scarcity of high-end housing on the market in south Dublin.

Prime infill site in Rathmichael for €2m


Three five-bedroom houses can be constructed on the 2.23-acre site in south Co Dublin


To use a football analogy, the European Commission went in studs up with its ruling yesterday on Apple’s tax affairs in Ireland.
The Government has been ordered to recoup up to €13 billion in unpaid taxes, plus interest, on the basis that Apple had been given selective treatment by Ireland through two tax rulings in 1991 and 2007.
This was a landmark decision by the commission, and the potential bill is a multiple of what had been expected by the Irish authorities and tax experts here.
According to the commission, the arrangement allowed Apple to avoid taxation on almost all profits generated by sales of its products in the EU single market, because Apple recorded the sales in Ireland rather than where the products were sold.
This was achieved by funnelling sales through a “so-called” head office in Ireland with “no employees, no premises and no real activities,” said commissioner Margrethe Vestager. Its activities consisted solely of occasional board meetings.
Head office profits
Only a fraction of the profits of Apple Sales International (an Irish-registered company) were allocated to its Irish branch and subject to tax here. The “remaining vast majority of profits were allocated to the ‘head office’, where they remained untaxed”, according to the commission.
In effect, this money was paid to Apple in the US to fund research and development.
In 2011, according to figures released at US Senate public hearings, Apple Sales International recorded profits of $22 billion (€16 billion). But under the terms of the tax ruling, only about €50 million were considered taxable in Ireland, leaving the balance of profits untaxed.
As a result, Apple Sales International paid less than €10 million of corporate tax in Ireland in 2011 – an effective rate of about 0.05 per cent on its overall annual profits.
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The Apple tax ruling The EC issued a ruling on August 30th in relation to the tax arrangements of Apple in Ireland, where it has its European HQ. The EC said Apple had been granted selective treatment by Ireland through two tax rulings in 1991 and 2007. The EC has ordered Ireland to recover up to €13 billion from the tech giant. Minister for Finance Michael Noonan indicated Ireland would appeal the decision "to defend the integrity of our tax system; to provide tax certainty to business; and to challenge the encroachment of EU state aid rules into the sovereign member state competence of taxation”. Q&A: Cliff Taylor answers the key questions I found this helpful Yes No
“In subsequent years, Apple Sales International’s recorded profits continued to increase but the profits considered taxable in Ireland under the terms of the tax ruling did not,” said Vestager. “Thus this effective tax rate decreased further to only 0.005 per cent in 2014.”
This, obviously, not the standard corporation tax rate of 12.5 per cent that has been in place in Ireland since January 1st, 2003.
This “artificial internal allocation of profits” was endorsed by the authorities here but had “no factual or economic justification” and amounted to State aid, the commission decided following a three-year investigation.
This tax ruling here was terminated when Apple Sales International and Apple Operations Europe (another Irish entity used by the maker of iPhones and iPads) changed their structures in 2015, which might help to explain that 49 per cent spike in our corporation tax receipts last year, to just under €6.9 billion.
Apple said it would appeal the ruling and that it was confident the decision would be overturned.
The Minister for Finance, Michael Noonan, will seek approval at an emergency Cabinet meeting on Wednesday to appeal the decision to the European courts.
Public opinion
Ireland has two months and 10 days to bring an appeal. By all accounts, Noonan wants to press the button immediately rather than chance other Ministers having their heads turned by public opinion or sniping from the Opposition.
“I disagree profoundly with the commission’s decision,” Noonan said. “Our tax system is founded on the strict application of the law, as enacted by the Oireachtas, without exception.”
In other circumstances, the Government would grab with both hands the opportunity to collect €13 billion in back taxes.
But such is the importance of foreign direct investment to the Irish economy that it doesn’t want to scare off existing or potential investors at a time when our recovery is still delicately poised. And it doesn’t want to give oxygen to calls from other member states for a harmonisation of corporate tax rates.
Both the Revenue Commissioners and the IDA were quick to issue statements in support of the positions taken by Apple and the Government.
Apple and Ireland might well be proved right in their assertions that the tax paid by the tech giant complied with the relevant tax laws, both here and in its home country.
But that really just makes the law, whether in Ireland, the US or elsewhere, an ass. How could such vast sums of money not be subject to tax somewhere in the world?
At a press conference to explain the commission ruling, Vestager made a common-sense point about Apple arrangements.
“I would have the feeling, if my effective tax rate would be 0.05 per cent falling to 0.005 per cent, I would have felt that maybe I should have a second look at my tax bill,” she said to much sniggering among the press corps.
She’s got a point. By accident or design, this was a sweetheart deal for Apple, the like of which wasn’t available to Irish SMEs or ordinary taxpayers.
Whether or not the arrangement was legal, it wasn’t fair to other taxpayers, be they Irish or American.
Twitter: @CiaranHancock1

Opinion: Apple’s Irish ‘sweetheart’ deal unfair to taxpayers


‘How could such vast sums of money not be subject to tax somewhere in the world?’


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Independent News & Media (INM) has reported relatively strong half year results in a challenged industry. But it needs to find suitable digital acquisition targets and execute buyouts, fast, if investors are to stay interested in its story.
Its results for the six months to the end of June show cash balances of €62.4 million, up by a whopping 76 per cent since this time last year. Fully one-third of its market value is attributable to cash, and at the current rate of generation, this could top 50 per cent early next year unless it finds buyout deals.
Challenges
Given the challenges facing the newspaper industry, to be frantically looking for ways to spend your cash to drive future revenues is, in relative terms, a bit of a first world problem. But it is a still problem.
Stock market investors don’t buy into media companies to get a one-third slice of its bank account. That’s a boring story. They want a growth story instead, and INM needs digital acquisitions to deliver it.
But if INM appears too desperate to dig out suitable acquisitions and deploy its cash, it may end up overpaying on its targets.
It is a delicate balancing act for Robert Pitt, INM’s chief executive who joined the group from Tesco. He indicated on Friday it has now widened its search for digital acquisition targets beyond the UK. In Ireland, it also wants to mop up smaller print assets.
Competition
Pitt also provided some colour on the type of digital businesses it wants to buy: “We are not looking for small start ups. We are not looking for turnarounds. We want to buy businesses that will have a positive impact on the bottom line as well as the top. They must be well defined [but not niche].”
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In other words, Pitt is targeting, in the UK and elsewhere, the same sort of value-accretive digital media businesses that every other traditional publisher with an eye on the future wants to buy. INM has competition for those assets.
The longer the group sits on its hands waiting for the right type of acquisition target at the right price to present itself, the less bang it will get for its buck as other media companies swarm the same pool, driving up prices.

If INM is to buy growth, former Tesco executive Pitt must go shopping


Analysis: Independent News & Media chief will find it is a competitive world out there


One of the United States Federal Reserve’s rate-setters has described the case for a further increase in short-term interest rates as “compelling”, arguing that the trends for employment and inflation are in the right direction.
Loretta Mester, president of the Federal Reserve Bank of Cleveland, said the US economy had “proven itself to be resilient through a number of shocks” which was why a gradual upward path for the federal funds target range was appropriate.
Upside risks
The Federal Open Market Committee (FOMC) member acknowledged there still might be negative risks looming overseas – for example, the slower Chinese growth rate and the aftermath of the Brexit vote – but she argued that the central bank also needed to recognise “upside” risks.
“If you inappropriately keep interest rates too low for too long then you put yourself in a position of perhaps having to raise interest rates more strongly in the future,” said Ms Mester, who votes on rates this year as part of the regular rotation between regional Fed presidents. “Those are the kind of risks we have to weigh . . . We have to be very deft about it.”
Her words follow a speech from Janet Yellen, the Fed chair, who signalled a rate increase was on the cards in the coming months.
Ms Yellen’s intervention at the Kansas City Fed’s symposium at Jackson Hole, Wyoming, came after a number of other Fed colleagues including Stanley Fischer, the vice-chair of the Federal Reserve board, and Bill Dudley, the president of the New York Fed, signalled they were open to a move. However, the minutes to the Fed’s July meeting suggested there were deep divisions among policymakers over how quickly to move.
Ms Mester was also attending the symposium at Jackson Lake Lodge. While second-quarter gross domestic product figures were soft at 1.1 per cent annualised growth, she argued that the consumer part of the economy was still quite strong, and employment was making progress.
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Inflation goal
In terms of what monetary policy can do with respect to maximising employment, “we are about there”, she argued. “I think that basically we are at the point where we have met that goal, and I think we are very close to meeting the inflation goal in terms of the path being up to 2 per cent over the next couple of years.”
Ms Mester declined to say what her decision would be at the Fed’s September meeting, saying she wanted to review all the economic data at that time and listen to her colleagues. But she added: “Making another gradual step – there is a compelling case for that.”
In a separate interview, fellow FOMC voter James Bullard of the St Louis Fed sounded ambivalent over whether a move should come as soon as September. Earlier this summer Mr Bullard switched to a dovish stance after his bank’s economists adopted a new approach to analysing the US. – (Copyright The Financial Times Limited 2016)

US interest rate increase case compelling, says Fed figure


Trends for US employment and inflation are in right direction, says rate setter


The North’s Minister for Finance Máirtín Ó Muilleoir will be keen to ensure there are no slip-ups this week during a scheduled visit to the Lurgan plant of an American-owned manufacturer of commercial carpet tiles.
Interface, a key employer in Lurgan, is due to play host to Ó Muilleoir as part of an initiative that aims to give the North’s business community an opportunity to get up close and personal, so to speak, with Executive Ministers.
During the event, organised by the Northern Ireland Chamber of Commerce, Ó Muilleoir wants to update local businesses about what his department has been doing recently and probably talk about his own endeavours to, as he puts it, “maximise EU funds” as the Brexit clouds hang overhead.
But probably what the business community would be more interested in hearing about is whether Ó Muilleoir is likely to have the rug pulled from under his feet any time soon.
In the last seven days while carrying out the responsibilities of Minister for Finance, Ó Muilleoir has also repeatedly rejected calls to temporarily step aside – or resign – primarily because of the latest Nama-related drama to unfold in the North.
Leaked Twitter exchanges obtained by BBC NI and the Irish News between former Sinn Féin MLA Daithí McKay, the previous chairman of the ongoing Stormont inquiry into the sale of Nama’s Northern Ireland portfolio and the loyalist blogger Jamie Bryson, have cast a shadow over not only the work of the previous committee, but also the way Stormont operates behind the scenes.
It is claimed that the Twitter exchanges suggest McKay and another Sinn Féin member Thomas O’Hara coached Bryson before he appeared in front of the Northern Ireland Assembly’s Committee for Finance to give evidence about the North’s then first minister Peter Robinson. Robinson has consistently denied any wrongdoing.
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Ó Muilleoir, who at the time was also a member of the committee that conducted the inquiry, is also referenced in the Twitter exchange.
The Minister for Finance has strenuously denied any knowledge of any communications between McKay, Bryson or O’Hara and has said accusations that he did, are “no more than petty party politicking”.
For Ó Muilleoir , who consistently and very loudly condemned Nama throughout the previous Stormont inquiry, these twittergate revelations are far from helpful as he continues less than four months into the job to try to win the support of the local business community.
One of his first actions as Minister was to release additional information to the current Stormont Committee for Finance relating to the Project Eagle sale in the “interests of transparency and public confidence”.
When he first became Minister back in May he spoke of the “great responsibility” of the job and said it was “not a role I will take lightly”.
He has embraced it with some enthusiasm – there has been no shortage of ministerial visits to small firms and inward investors alike while the North’s Assembly has been on holidays. But Ó Muilleoir is facing into a key period.
First up he has the “Brexit effect” to contend with including the questions about what could potentially happen to the €1.2 billion structural and investment fund programmes that the European Union had pledged to Northern Ireland to run between 2014 and 2020.
Then there is the looming likelihood of further intense budgetary pressures for the North as the UK government continues to regroup after the EU referendum vote. Ó Muilleoir is already hearing in person from firms who are deeply worried that the Executive may not be doing enough at the moment to make sure that Northern Ireland will get its own “bespoke arrangements” post-Brexit.
A coalition of 11 industry organisations, convened by the Derry Chamber of Commerce, have also urged the Executive to step up and provide “reassurance and confidence” at this time of economic uncertainty.
In the short term, however, Ó Muilleoir will focus on holding on to his job. The UUP, Alliance, SDLP and the Finance committee have all called for him to stand aside, as the Project Eagle inquiry takes yet another unexpected twist.

Máirtín Ó Muilleoir finds himself battling on Nama, Brexit fronts


Minister for Finance under pressure to resign is due to visit Interface’s Lurgan plant


Irish Continental Group said the Brexit vote had a brief impact on tourism bookings, but they have since recovered, as the ferry operator reported a 19.6 per cent increase in earnings for the first half.
Earnings before interest, tax, depreciation and amortisation rose to €30.5 million from €25.5 million for the same period last year as car carried on its ships increased 5.5 per cent and roll-on, roll-off (RoRo) freight volumes gained 5.6 per cent.
Container volumes shipped during the period rose 7.4 per cent, it said.
“Tourism carryings over the key summer months were broadly in line with expectation though the continuing sterling weakness since the end of June has resulted in lower euro equivalent tourism yields,” John B McGuckian, ICG’s chairman said.
“The UK Referendum result has, to date, had very little impact on RoRo freight volumes which remain strong. Notwithstanding the impact of weaker sterling ICG is well placed to benefit from the underlying growth trends in both car and freight volume,” he said.
ICG will pay out 3.82 cent dividend for the first half, up 5 per cent on its last interim dividend.
Net debt at the group fell 57 per cent from the end of December to €18.9 million, it said.

ICG says tourism bookings recover after Brexit wobble


Earnings at ferry group rose 19.6 per cent, driven by car and freight volumes


Lifeline, the private ambulance operator service owned by businessman David Hall, reported a €101,231 profit for the 12 months ending June 2015. This compares to a €436,412 loss the previous year, newly-filed abridged accounts show.
The company, recently involved in a high-profile court action involving employees, had net assets of €106,794, as against just €5,563 a year earlier.
Turnover rose to €4.3 million as against €4.1 million the year before, having halved between 2008 and 2014.
Established by David Hall in 1998, Lifeline is the largest private ambulance operator in the State with a fleet of 49 vehicles. Based in Leixlip, Co Kildare, the company employs 66 people.
Mr Hall is also founder of the Irish Mortgage Holders Organisation (IMHO), which last year helped over 2,500 people to come to an arrangement with lenders over their debts.
HSE contract
Lifeline has a framework agreement with the Health Services Executive (HSE) through a service level contract for patient transport services. However, the company has previously taken legal proceedings against the HSE for alleged breaches of the agreement and Mr Hall told The Irish Times that additional proceedings were currently “on hold”.
Mr Hall said the return to profitability was partly due to better compliance with the Lifeline contract by the HSE.
“We won the tender to be the number-one provider nationally and that contract hasn’t been adhered too and, while it is not being fully complied with, there has been an improvement. If we don’t see further improvement though we will end up back in court,” he said.
“The need to injunct the HSE to comply with the contract is currently under review, as is seeking to recover monies not given under it, which were given to third parties.”
Mr Hall added that the turnaround was also due to him being back at the helm again. “I’m back running Lifeline again after being more focused on the mortgage stuff over the last couple of years, “ he said. “There has been a restructuring of the company and a better focus on how it is being run that has involved us looking at our cost base and so on.”
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Mr Hall and his wife Susan Wiseman Hall are listed as directors of Lifeline. Directors’ emoluments for the year ending June 2015 totalled €209,966, down from €217,817 a year earlier.
The accounts show Mr Hall previously provided a guarantee to the value of €377,000 for the company’s banking facilities.
Lifeline operates from a premises owned by Mr Hall, paying him rent in the year to the end of June 2015 of €116,379.
Future viability
The latest set of accounts said restrictive practices in the sector, the state of the economy and a decline in the number of people with private health cover were all concerns that threatened the viability of the company.
However, Mr Hall said that conditions generally had improved over the last year. “All health-related businesses were under pressure for a long time and I wasn’t around. I expect the 2016 accounts will post a higher profit than the 2015 ones. I’m back doing what I think I do well, which is running the business and we’ve acquired an additional 10 ambulances this calendar year and taken on 17 extra staff in the last number of months, so things are going the right way,” he said.
Two managers at Lifeline recently became the first employees in Ireland to win court protection under newly introduced whistleblower legislation.
The Circuit Court ruled late last month that Mick Dougan and Seán Clarke, who were made redundant after accusing Mr Hall of “serious wrongdoing” in a disclosure to the Revenue Commissioners, should continue to be paid until their unfair dismissal case is heard.
The men claimed in affidavits opened in court, that staff were paid mileage expenses in place of taxable pay and alleged they were subjected to bullying and harassment.

David Hall-owned ambulance service Lifeline back in rude health


Private ambulance operator service reports a €101,231 profit for year ending June 2015


Salaries for new hires fell by an average of 15 per cent in the years 2005-2014, as employers responded to a surge in unemployment by cutting earnings for new employees, a new study from the Central Bank shows. However the authors noted that right at the end of 2014, as unemployment continued to decline, earnings for new hires started to improve.
The study showed that while many people were grateful simply to get a job during a recession, it was a bad time to get hired as employers tend to lower what they offer new hires.
This means that if you started a new job during the recession, you may have been offered 15-20 per cent lower than what a similar job would have paid before the downturn. Average hourly earnings for new hires fell from €13 in 2007 to €11 in 2013.
The Central Bank said the finding is “remarkably robust” and echoes previous studies in the United States, which show that when unemployment rises by about 5 per cent, earnings for new hires drops by 7.5 per cent.
The rise in unemployment was about double that in Ireland during the recession, which accordingly gives rise to the 15 per cent drop in new hire earnings.
The findings of the study are more stark than a previous report from Central Bank author Reamonn Lydon, which showed that during the early-1990s slowdown, new graduates’ earnings fell by about 8 per cent, significantly less than the 15 per cent decline across all earnings evidenced in this report, although the rise in the unemployment rate this time around was much higher than during the 1990s (c10 per cent compared with 2 per cent).
The study considers “new hires” to include: new graduates; “inactive” workers, ie those who worked in past and exited the labour market for family or other reasons; and the unemployed.
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The average age of new hires in the study was 32-33, which shows that even those with considerable experience suffered a decline in starting rates of pay during the recession.Those who simply changed their job during the recession do not appear to have suffered from a similar cut in earnings.
Professional earnings
The study found more highly educated workers escaped the worst of the cuts, as their earnings appeared to be less correlated with a rise in unemployment, but the decline was even greater than 15 per cent for those with lower levels of education, while employees aged between 45-60 also fared worse than younger workers.
“Earnings of new hires from unemployment tend to become more sensitive to the state of the business cycle when workers are likely to have less attractive outside options. These are typically workers with lower education or workers that are older, yet not sufficiently old to wait out the unemployment spell until they become eligible for retirement,” the report said.
The findings showed no distinction between public and private sector workers during the period.
The data was based on the pre-tax earnings of employees in Ireland between 2005 and 2014 with the data from 2013 Household Finance and Consumption Survey.

Salaries for new hires fell 15% during recession - study


Central Bank study finds employers cut earnings for new workers as unemployment rose


The European Commission has found that Apple owes the Irish State € 13 billion in back taxes after ruling that the technology giant’s tax arrangements in Ireland constituted a form of illegal state aid.
That works out as approximately €2,732 for every single person in the Republic of Ireland.
So, what could the Irish State buy with that €13 billion? Here are a few ideas:
1. MacBooks for everyone in the audience
If Apple settles its debt by doling out merchandise, each person in Ireland would get approximately one 15 inch Mac Book Pro, valued at about €2,800.
2. Free pints for TDs
If the Government chose to spend the entire sum on free pints and food in the Dail, they could have an open tab for 10,833 years, meaning they wouldn’t pay for a cheap Guinness until the year 12849.
3. A Spire in every school
We could build roughly 3,250 replicas of the Spire on O’Connell Street in Dublin. Enough for each of Ireland’s 3,200 primary schools, with a few left over. OR, we could stack them end-on-end on O’Connell Street, tip the whole lot over in a south-easterly direction, and it would reach Oxford.
4. Shelve motor tax
The Government could pick up everyone’s motor tax bill until about the year 2028.
5. The Irish Times
The State could buy one copy of The Irish Times for every single person in the Republic of Ireland every single day of the week (except Sundays, of course) for the next four years. Sure what more would you want?
6. Tim Cook
The CEO of Apple, Time Cook, is worth roughly €704 million. So by our calculations, you could buy 1,847 Tim Cooks.
7. Dublin to Lisbon
It costs an average of € 8 million to build one kilometre of motorway in Ireland, meaning you could build1625km of motorway. That would get you from Dublin to Lisbon.
8. Steve Jobs’ black turtleneck
In memory of the co-founder of Apple, Steve Jobs, you could buy 97 million replica black turtlenecks, his favourite item of clothing.
9. The fiscal chasm
The fiscal space – allowing tax cuts and increased spending - is expected to be about € 1 billion in October’s budget and about €11 billion between now and in budgets up to 2021. So the Apple tax windfall could deliver tax cuts and spending increases until then (with € 2 billion left over). All assuming Fianna Fáil supports them of course.
10. Olympics
The Brazil Olympics cost an estimated €1.43 billion, meaning Ireland could host nine Olympic Games and still have change.

What could Ireland buy with the €13bn Apple tax?


We could give the Government an open tab in the Dáil bar for 10,833 years


Nobody is more intimately acquainted with the ESB and its extensive network of pylons than its telecoms cousin Eir.
Eir’s chairman Padraig McManus was the former chief executive of ESB , until last year, while its recently retired head of networks, John Shine, was the ESB’s deputy chief executive as recently as 2013.
Confused? Welcome to the merry-go-round of Irish business. Eir’s insider knowledge of the electricity utility could come in handy with both companies vying for a slice of the action under the National Broadband Plan (NBP).
The ESB entered the telecoms market last year via its joint venture with Vodafone, Siro.
Under the EU’s shared utilities directive, infrastructural companies are now obliged to open up their networks to other operators to facilitate the construction of vital telecommunications networks such as the NBP.
As part of its fibre broadband roll-out, and under the auspices of its NBP bid, Eir has already submitted five “access requests” to ESB seeking to use its infrastructure.
Such use could mean a significant cost-saving for Eir, which is forced to drop poles along the country’s circuitous road network unlike the ESB which enjoys a legal right to access private lands.
However, with the ESB bidding against Eir for the NBP contract, it remains to be seen if the electricity company will be sufficiently motivated to facilitate these requests, potentially enhancing its rival’s bid.
“At this point we have made over five requests to the ESB but have received no satisfactory response to date,” an Eir spokeswoman said. The ESB declined to comment.
The ESB could, in theory, seek access to Eir’s network via the same directive but there is an asymmetry in the relationship between the State’s two big utilities.
For one, the ESB’s network is more extensive than Eir’s and is in better condition having benefited from an €8 billion upgrade in recent years.
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Eir can’t boast the same level of upkeep and has suffered from years of underinvestment, which critics link to privatisation.
The escalating friction between these two sectoral incumbents makes for an interesting spectacle.


As both companies vie for broadband business, Eir piles on pressure to use ESB pylons


Are you a saver or a spender?
I’m generally a day-to-day saver, though when it comes to gadgets, all sensible thoughts go out the window. Gadgets, I definitely tend to splurge on them.
Do you shop around for better value?
In every aspect of business life I would say yes. The three-quote rule was hammered into me at a very young age and has served me well through the years. In personal life, I do shop around a little, with the exception of Christmas shopping, which, despite my very best effort is always done on Christmas Eve.
What has been your most extravagant purchase ever and how much did it cost?
I wouldn’t be a frequent extravagant buyer by any stretch. I do, however, like to invest in family memories, as cheesy as that sounds. Every year I look forward to one “blow out” holiday with my daughter, Katy-May, and my wife, Clare. I also have an appreciation for a good watch, so I treated myself to a Breitling a few years ago. I’ll keep the price of that to myself, though.
What purchase have you made that you consider the best value for money?
Undoubtedly, I would say, my wife Clare’s engagement ring nine years ago.
What way do you prefer to shop – online or local?
Whilst I like to do price comparisons online before I buy, I still love the fun and excitement that comes with shopping locally. There is nothing like shopping face to face, getting real customer satisfaction, and most importantly personal great customer service.
Do you haggle over prices?
My background is in sales, so on big items I love to haggle. It’s always good to gauge reaction and see what new sales lines are out there. Sales psychology fascinates me, so I like to visit car dealerships from other brands and see what kind of sales pitches work for them.
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Has the recession changed your spending habits?
I think it changed spending habits for everyone. As a family, we cut down on big non-essential items and focused on quality holidays over quantity.
Do you invest in shares?
When I first started working in Renault many moons ago, there were two colleagues of mine always harping on about shares. I never really got into them. I did the usual like most Irish people and invested a little in Eircom and Vodafone shares. In the last couple of years I have (wisely) invested in shares within the Renault Group.
Cash or card?
On small items below €50 always cash, then everything else is the card.
What was the last thing you bought and was it good value for money?
The last thing I bought was a tent. My family and I absolutely love it. Camping is so much fun around Ireland, especially when the sun comes out.
Have you ever successfully saved up for a relatively big purchase?
Yes, thanks to my general save-not-spend habit I saved up for the family home. Saving up for a deposit on a house is such a satisfying achievement.
Have you ever lost money?
I never lost anything substantial, thankfully. My mother schooled me as a teenager playing cards at home, so that has and hopefully will continue to sort me in the future.
Are you a gambler and if so have you ever had a big win?
I wouldn’t be a regular gambler at all. I like the social aspect and the atmosphere that comes with big GAA events or Punchestown, etc, so I would flitter away a few euro to join in and have a bit of craic. No big wins or losses so far.
Is money important to you?
Security is important to me, so I guess money is important in that aspect. I’m very content with my life at the moment. Money definitely isn’t my day-to-day focus. Once my house is ticking over and my family are happy and healthy, I’m truly happy with my lot.
How much money do you have on you now?
€28.80. And a credit card, just in case.

Me & My Money: Paddy Magee, Renault Group Ireland


‘There is nothing like shopping face to face, getting real customer satisfaction’


Brussels is poised to hand down an adverse ruling against Ireland after a three-year inquiry into claims the country granted an illegal tax arrangement to Apple, the world’s biggest tech company.
The long-awaited findings, likely to be released next week, follow an intensive effort by the United States to persuade the European Commission to drop the inquiry.
Apple could be on the hook to pay billions of dollars in back taxes to Ireland in light of the finding that tax rulings conferred illegal State aid to Apple by granting it an advantage not made available to other companies.
The commission made no comment on Friday on the timing or substance of its decision.
There is some uncertainty as to whether a precise penalty will be defined in the ruling, JPMorgan, Apple’s investment banker, has said Apple’s potential liability, in a worst-case scenario, could be up to €19 billion. In other assessments, however, the liability may come in at about $1 billion.
An adverse ruling by competition commissioner Margrethe Vestager would be appealed in the European courts by Ireland and Apple, each of whom have strenuously denied any wrongdoing in the tax arrangement.
Any move to issue negative findings without defining the penalty would also prompt Apple and Irish authorities to campaign to minimise the bill.
The Apple case is the biggest single investigation undertaken by the commission in a clampdown on aggressive tax avoidance in Europe by big global companies.
In previous rulings, Ms Vestager has directed the Netherlands to recover back taxes from Starbucks, and Luxembourg to recover back taxes from Fiat. Both rulings are under court appeal.
The commission issued preliminary findings against Ireland in 2014 before initiating an in-depth investigation into tax rulings Apple received from the Dublin authorities in 1991 and 2007. The company has faced criticism in the US Senate for paying a 2 per cent corporate tax rate in Ireland, far lower than the country’s headline 12.5 per cent rate.
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Expectation of an adverse ruling gathered pace this week after the US Treasury issued a stinging attack on the commission’s investigation, saying the EU executive was becoming a “supranational tax authority” that threatened international agreements on tax reform.
Tim Cook, Apple chief executive, who pressed his company’s case in a private meeting with Ms Vestager in January, has always insisted the business fully complied with tax law.
The commission says there has been no bias against any US company in its investigation.
“Under EU state aid rules, national tax authorities cannot give tax benefits to selected companies that are not available to others. These state aid rules and the relevant legal principles have been in place for a long time,” the commission said on Wednesday.
In recent days, expectation intensified in Brussels, Dublin and corporate circles that an unfavourable ruling was in prospect.
The intervention by the Obama administration this week marked a sharp escalation of tension between Washington and Brussels.
Jack Lew, US Treasury secretary, called on the commission in February to reconsider the inquiries. He has come under pressure from the Senate finance committee to consider imposing a double tax rate on European companies if the commission directs Apple to pay back taxes in Ireland.
– (Copyright The Financial Times Limited 2016)

Brussels poised to strike down Apple ‘State aid’


Tech firm may have to billions of dollars in back taxes to Ireland in light of inquiry


JOE BRENNAN
Apple may ultimately be hit by a €19 billion bill in Ireland on foot of a landmark EU ruling that the US technology giant received selective tax treatment in the Republic, according to Grant Thornton.
The European Commission ordered Ireland on Tuesday to recover unpaid taxes in this country from Apple for the years 2003 to 2014 of up to €13 billion, plus interest.
Grant Thornton tax partner Peter Vale estimates that the interest costs could come to a further €6 billion. However, Apple’s chief financial officerLuca Maestri told reporters on a conference call on Tuesday afternoon that the company believes the interest bill will be “a significantly lower number”.
“Given the nature of the Commission’s ruling, it is difficult to see Ireland having any option other than to defend its position. To do otherwise would result in Ireland bearing the brunt of negative coverage for a period of time, significantly impacting on our reputation,” said Mr Vale.
Both the Government and Apple said they intend to appeal the decision in court.
The EU’s decision, which found that Ireland’s “selective treatment” of Apple allowed the company pay an effective corporate tax rate of 1 per cent on its European profits in 2003, falling to 0.005 per cent in 2014.
The finding comes as Ireland finds itself at a “critical juncture” in terms of attractive foreign direct investment, following the UK’s decision to exit the EU, according to Mr Vale.
While the Revenue Commissioners are obliged, following the EU’s decision, to issue a tax bill to Apple, any monies collected will be held in escrow as the Government appeals the ruling.
“While assessing the likelihood of success at ECJ (European Court of Justice) level is difficult, there would appear to be a strong case supporting an appeal,” said Mr Vale. “In the meantime, while the tax to be collected is hugely significant, this is unlikely to be made available for public expenditure purposes pending the appeal result. “

Apple’s Irish tax bill may hit €19bn, including interest, experts say


Technology company faces interest bill of as much as €6 billion, Grant Thornton says


Britain’s high streets are heaving with shoppers despite June’s shock vote to leave the EU, big companies have reported few signs of distress and some tabloid newspapers are even talking about a post-Brexit economic boom.
The overwhelming view from economists is that it is too early to know how Britain will cope with years of Brexit uncertainty - but there is a growing belief the country can avoid a recession that only weeks ago was regarded as likely.
On the face of it, the early optimism contrasts with the pre-referendum warning from former prime minister David Cameron that a Brexit vote would put a “bomb under the economy”.
Retail sales in August reversed much of an immediate post-Brexit vote fall, with retailers reporting their strongest sales in six months, industry data showed on Thursday, partly due to a weaker pound attracting overseas buyers. Official figures out last week showed the number of people claiming unemployment benefit fell unexpectedly in July.
Before the June 23rd referendum, the British finance ministry had warned a Brexit vote would mean homeowners facing higher borrowing costs, pushing the economy into a “DIY recession”, and that equity prices were likely to fall. However, nearly half of mortgage borrowers look set to gain from the Bank of England’s interest rate cut on August 4th, while British equity markets have risen. Some British newspapers which supported the Leave campaign have hailed such news. “Remainers were WRONG!” the Daily Express declared earlier this month, adding: “Brexit Britain booms”.
But most economists do not share this jubilance and caution these positive signals may have little bearing on the long-term outlook for the economy, which must contend with years of uncertainty as Britain extricates itself from the EU.
New British prime minister Theresa May has said she will not trigger the EU’s Article 50 this year, to begin formal talks with the bloc to negotiate the terms of Britain’s exit from the EU and its future trading relationship with the bloc. “The fact that the UK avoided an immediate crisis does not tell us much about the future,” said Holger Schmieding, chief economist at Berenberg Bank, adding he thought Britain would probably avoid a technical recession - defined as two consecutive quarters of falling economic output.
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Business surveys and some forward-looking indicators of inflation already offer reasons for caution. Price pressures in factories - which feed through into consumer prices - shot higher after the pound’s post-referendum plunge, posing a threat to consumers’ future spending power. Market research firm GfK’s gauge of consumer confidence also fell sharply after the vote. The survey often predicts changes in household spending in the following quarters. A YouGov/CEBR gauge of consumer morale, published on Friday, showed consumers have regained some of the confidence they lost after the referendum, but researchers warned this positive trend could easily change next year.
The outlook for the housing market, the bedrock of British consumer wealth, is also unclear: a Reuters poll on Thursday suggested the Brexit vote will have a negative impact on both prices and turnover.
Charles Goodhart, a former BoE interest-rate setter, said so far there had been almost no data on important areas of the economy such as investment, inventory levels and construction. “I think it would be very dangerous to take a position either that it’s all going to be alright and that the fears were massively overdone, or that the fears were justified,” said Goodhart, a professor at the London School of Economics, said. “The answer is, frankly: we don’t know.”
While the mood among economists remains one of concern, it has brightened across financial markets. Investors were braced for a global economic shock after a vote for Brexit, but the FTSE 100 index of UK blue-chip companies is about 8 percent higher since the referendum, helped by overseas earnings that will benefit from the fall in the value of the pound. The more domestically focused FTSE 250 index of mid-sized companies is up by about 5 per cent. Many big companies have reported little immediate impact from the vote in Britain, including retailers John Lewis and Next, the world’s biggest staffing company Adecco and carmaker BMW.
Some major employers - carmaker Nissan, for example - say their plans for investment in Britain will hinge on the trade deals it strikes with other countries. Martin Sorrell, chief executive of the world’s largest advertising group WPP, said there was little clarity on when Britain would even begin negotiating its EU exit and that his company’s clients were increasingly cautious. “Our own position will depend on what gets negotiated,” he told Reuters.
The pound’s fall since the referendum - it was down almost 15 percent at one point versus the dollar - has benefited some companies; it has boosted manufacturers’ exports, for example. But it also reflects the weaker outlook for the economy. “In essence, the currency markets are saying that all UK assets are worth less than they used to be,” Rupert Pennant-Lea, a former BoE deputy governor, wrote in the Financial Times.
“The British have become poorer than they were before the votes were counted on June 23rd, and that reality will become clearer as the months go by.” But investors, responding to the recent upbeat data, have cut their bets against a weaker pound this week, which has helped lift the currency. Sterling has started to edge higher against major currencies, but it remains around 11 percent lower against the dollar than before the referendum, underscoring how investors see the challenge ahead for Britain’s economy.
Reuters

British economy escapes Brexit blow, for now


Retail sales data for August reverse much of Brexit fall


The North’s Minister for Finance Máirtín Ó Muilleoir will be keen to ensure there are no slip-ups this week during a scheduled visit to the Lurgan plant of an American-owned manufacturer of commercial carpet tiles.
Interface, a key employer in Lurgan, is due to play host to Ó Muilleoir as part of an initiative that aims to give the North’s business community an opportunity to get up close and personal, so to speak, with Executive Ministers.
During the event, organised by the Northern Ireland Chamber of Commerce, Ó Muilleoir wants to update local businesses about what his department has been doing recently and probably talk about his own endeavours to, as he puts it, “maximise EU funds” as the Brexit clouds hang overhead.
But probably what the business community would be more interested in hearing about is whether Ó Muilleoir is likely to have the rug pulled from under his feet any time soon.
In the last seven days while carrying out the responsibilities of Minister for Finance, Ó Muilleoir has also repeatedly rejected calls to temporarily step aside – or resign – primarily because of the latest Nama-related drama to unfold in the North.
Leaked Twitter exchanges obtained by BBC NI and the Irish News between former Sinn Féin MLA Daithí McKay, the previous chairman of the ongoing Stormont inquiry into the sale of Nama’s Northern Ireland portfolio and the loyalist blogger Jamie Bryson, have cast a shadow over not only the work of the previous committee, but also the way Stormont operates behind the scenes.
It is claimed that the Twitter exchanges suggest McKay and another Sinn Féin member Thomas O’Hara coached Bryson before he appeared in front of the Northern Ireland Assembly’s Committee for Finance to give evidence about the North’s then first minister Peter Robinson. Robinson has consistently denied any wrongdoing.
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Ó Muilleoir, who at the time was also a member of the committee that conducted the inquiry, is also referenced in the Twitter exchange.
The Minister for Finance has strenuously denied any knowledge of any communications between McKay, Bryson or O’Hara and has said accusations that he did, are “no more than petty party politicking”.
For Ó Muilleoir , who consistently and very loudly condemned Nama throughout the previous Stormont inquiry, these twittergate revelations are far from helpful as he continues less than four months into the job to try to win the support of the local business community.
One of his first actions as Minister was to release additional information to the current Stormont Committee for Finance relating to the Project Eagle sale in the “interests of transparency and public confidence”.
When he first became Minister back in May he spoke of the “great responsibility” of the job and said it was “not a role I will take lightly”.
He has embraced it with some enthusiasm – there has been no shortage of ministerial visits to small firms and inward investors alike while the North’s Assembly has been on holidays. But Ó Muilleoir is facing into a key period.
First up he has the “Brexit effect” to contend with including the questions about what could potentially happen to the €1.2 billion structural and investment fund programmes that the European Union had pledged to Northern Ireland to run between 2014 and 2020.
Then there is the looming likelihood of further intense budgetary pressures for the North as the UK government continues to regroup after the EU referendum vote. Ó Muilleoir is already hearing in person from firms who are deeply worried that the Executive may not be doing enough at the moment to make sure that Northern Ireland will get its own “bespoke arrangements” post-Brexit.
A coalition of 11 industry organisations, convened by the Derry Chamber of Commerce, have also urged the Executive to step up and provide “reassurance and confidence” at this time of economic uncertainty.
In the short term, however, Ó Muilleoir will focus on holding on to his job. The UUP, Alliance, SDLP and the Finance committee have all called for him to stand aside, as the Project Eagle inquiry takes yet another unexpected twist.

Máirtín Ó Muilleoir finds himself battling on Nama, Brexit fronts


Minister for Finance under pressure to resign is due to visit Interface’s Lurgan plant


UK consumers stepped up their spending in the second quarter and businesses increased investment as the economy showed few signs of reticence before the June Brexit referendum.
Household spending rose 0.9 per cent from the first quarter, the fastest pace in almost two years, the Office for National Statistics said on Friday. Business investment gained 0.5 per cent.
Growth overall quickened to 0.6 per cent from 0.4 per cent, unrevised from an initial estimate.
“Our survey returns, which include the period leading up to and immediately following the referendum, show no sign so far of uncertainty having significantly affected investment or GDP,” ONS chief economist Joe Grice said in a statement.
The decision to leave the European Union has cast an abrupt shadow over the economy, prompting the Bank of England to cut interest rates this month and piling pressure on new prime minister Theresa May to deliver a tax and spending boost.
While surveys suggest the June 23 referendum has done little to dampen the spirits of consumers, tougher times may lie ahead as quickening inflation threatens to erode almost two years of real-wage growth.
The rise in businesses investment last quarter was driven by spending on transport equipment including cars and planes, the ONS said.
The level of investment was 0.8 per cent lower than a year earlier. Net trade once again dragged on the economy, knocking 0.3 per centage point off growth in the second quarter as exports barely rose.
The 10 per cent fall in the trade-weighted value of the pound since the Brexit vote may aid exports, but not by enough to prevent a sharp slowdown.
The economy will contract by 0.1 per cent in the third quarter, according to economists polled by Bloomberg between August 5 and August 12.
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The pound showed little response to the figures and was at $1.3218 as of 9:41 a.m. London time, up 0.2 per cent on the day.Growth in the second quarter was heavily centered on April.
Bloomberg

UK consumers stepped up spending in the second quarter


Surveys suggest Brexit referendum has done little to dampen the spirits of consumers


A partially occupied office portfolio located within Blanchardstown Corporate Park in Dublin 15 is to be offered for sale at around €1.8 million through QRE Real Estate Advisers on the instructions of receivers Deloitte.
Providence House, a three-storey block with a floor area of 1,104sq m (11,881sq ft) and basement car parking is currently occupied by Arvato, who will be moving out at the end of the year.
The second lot includes a first floor unit of 260sq m (2,796sq ft) and an own-door ground floor area of 97sq m (1,045sq ft). Both have their own car parking facilities.
The sale also includes 257sq m (2,776sq ft) in Block 1 which is occupied by iCom Technologies on a 25-year lease from 2004.
The fifth unit is located on the first floor and shares the access with one other tenant. The unit has a floor area of 112sq m (1,207sq ft).
Blanchardstown Corporate Park has a range of attractive amenities including a childcare centre, Spar convenience store, an O’Brien’s sandwich bar and bagel factory and the Bell and Bear restaurant.

Blanchardstown office portfolio for sale at €1.8m


Partially occupied office portfolio has five units


Siro, the commercial broadband venture between ESB Networks and Vodafone, has signed up telecoms firm Digiweb as a retail partner.
Dundalk-based Digiweb plans to launch a number of fibre packages for residential and business customers on Siro’s network.
The company’s “Electric Broadband” services will go live in Dundalk, Letterkenny and Drogheda later this year, before it expands elsewhere via’s Siro’s ongoing rollout.
Siro is among the final shortlist of three firms for the Government’s National Broadband Plan, which aims to build a high-speed broadband infrastructure
The scheme was recently expanded to encompass 927,000 homes, more than a third of the State’s housing stock.
Siro is investing €450 million in a fibre-to-the-building network, primarily aimed at 50 regional towns.
It recently upgraded Skibbereen’s connectivity status, bringing it to the same level as leading international business hubs such as Hong Kong and Tokyo.
Commenting about the partnership with Digiweb, Sean Atkinson, chief executive of Siro, said: “Our partnership with Digiweb illustrates how Siro is driving competition in Ireland’s broadband marketplace.”
“We want to migrate Ireland from legacy copper based networks to 100% fibre-optic networks, this will ensure that people across the country can avail of next generation services and drive the economy forward,” he said.
Declan Campbell, managing director of Digiweb, added: “This is a different kind of internet and we are delighted to be offering our customers the choice.”
“It will be great to be able to offer our customers Siro powered broadband packages of up to one gigabits per second, enabling us to deliver one of the most powerful broadband services available in Ireland,”he added.

Digiweb to launch fibre products on Siro’s network


Dundalk-based becomes Siro second retail partner after Vodafone


When I was at university I spent a summer travelling around Europe with some friends, and one of them suggested we drop in on his parents’ place in the south of France.
There are two things I remember about that visit. There was the mortification of being greeted by a butler who ceremoniously carried my tatty luggage – a few things stuffed into a plastic bag – to the suite of rooms I’d been allocated. But what stays in my mind even more was the image of his father – who turned out to be a famous tycoon – clad in small swimming trunks with cigar clamped between teeth, holding a gin and tonic in one hand and a telephone receiver in the other.
The year was 1979 and this was what power looked like. The man was too important to be out of touch with the deals he was doing. So he had installed a telephone line by the swimming pool and passed his summers issuing instructions from a lounger by the water.
A quarter of a century later, technology allowed all of us to pretend to be tycoons. We might not have had the butler or the pool house but everyone could head to the beach with a BlackBerry packed along with their towels. And because we could, we did. Only for most of us, what we were doing was not deals, it was responding to mundane inquiries that could have waited two weeks – or forever.
This year, I decided to do something radical that I hadn’t done for almost a decade. I took a proper holiday. I disconnected myself from work altogether. I didn’t open any work messages. I spent time reading, walking, looking at the sea – and sometimes getting into it – while I thought about not much at all.
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Immersion in work
When I returned to work and reacquainted myself with email, it was perfectly straightforward. I deleted almost all of them unread, responding only to the things that looked interesting. Far from feeling overwhelmed, I felt a certain excitement in the sudden immersion in work. It was a new-shoes and sharp-pencil sort of feeling that used to go with the beginning of a school term.
Over the past week it has started to dawn on me that my radical action was not radical at all. I was merely following the latest fashion.
Last week I sent an email to an entrepreneur I know, and within seconds the automatic reply came back: “I am on holiday until August 30 and will not be checking messages.” This was particularly remarkable given that last time I’d seen him – some five years ago – he had told me how he expected all his employees to respond to messages instantly wherever they were and whatever they were doing.
So I emailed back asking what had made him change his mind – but all I got in return was the same automatic message telling me he wasn’t reading whatever I was sending.
The very next day I got an email from a woman who I had contacted before I went away. It began: “Sorry for my radio silence – I have had a blissful two-week holiday and am just catching up on emails on my return.” Here was the same thing again: a driven, thirtysomething entrepreneur who wanted me to know not how hard she worked on holiday but how she loafed around, and how much she enjoyed it.
Experiment
To see how widespread this change is, I’ve done a little experiment. I’ve collected all the out-of-office emails I’ve had this summer, and counted the number that were followed at once by an email sent from the beach. Three years ago, it was very unusual for an automatic message not to be quickly followed by a real one. This year I’ve had a total of 38 automatic messages telling me the sender was away, only six of which have been succeeded by a personal, poolside reply.
Bragging about not working on holiday seems to be part of a wider trend - which I wrote about a few months ago – in which fashionable execs flaunt not their long hours, but their short ones. To be emailing from the pool does not prove you are powerful, it is starting to be seen for what it is – a sign of weakness, poor time management and an inability to delegate. If you can take two weeks off altogether it shows you have overcome all gadget addiction, and like a modern-day tycoon can control when you work – and when you don’t. – (Copyright The Financial Times Limited 2016)

Poolside working no longer a sign of importance


Bragging about not toiling on holiday part of wider trend of shorter working hours


Providence Resources sees the cost of drilling an exploration well at its Druid field in the Atlantic Ocean will be 30 per cent lower than previously planned as it hired a company to manage the process next year.
The Tony O’Reilly Jnr-led oil and gas exploration company said it and its license partner for the Druid prospect have appointed Senergy Wells Ltd, a subsidiary of global engineering group Lloyds Register to provide well management services for the planned drilling programme in June 2017.
Providence has previously estimated the Druid field, some 220 kilometres off the west coast of Ireland, could ultimately deliver 3.9 billion barrels of oil, a multiple of the 311 million barrels of recoverable oil its Barryroe oil field south of Cork is estimated to hold.
The company now estimates that the cost of drilling the Druid exploration at about $35 million (€31.4 million), some 30 per cent lower than a previous estimate.
Drilling costs have slumped globally following a drop in oil price in recent years.

Providence sees Druid exploration well cost at $35m


Oil and gas exploration company hires Senergy Wells to manage 2017 Druid exploration


The Irish Farmers’ Association (IFA) has published a report raising further concerns about the part takeover of Slaney Meats by Larry Goodman’s ABP Group.
The report suggests the deal would have an adverse impact on competition in the beef processing sector and would make “co-ordinated effects” on price more likely.
The IFA has already submitted the report, prepared by Pat McCloughan of PMCA Economic Consulting, to the competition authorities in Brussels, which have yet to rule on the deal.
“This report is very clear on the competition concerns in the beef sector, the income pressures that exist for livestock producers and the impact that any weakening of competition would have on their livelihoods,” IFA president Joe Healy said.
The Slaney deal is at the centre of an escalating row between the IFA and ABP .
Earlier this month, the Goodman firm halted the automatic collection of levies from farmers, which part fund the IFA.
The farmers’ group claims this was in retaliation for its opposition to the Slaney deal - a claim the company denies.
Presenting the findings of the report, Dr McCloughan pointed out that ABP and Slaney combined currently account for 25.8 per cent of all cattle slaughterings in the State.
However, when the market is narrowed down to premium cattle, the figure rises to 36.2 per cent, he said.
Dr McCloughan also outlined the growing gap in cattle prices between Ireland and Britain, the State’s largest export market, which has been a source of tension between farmers and processors.
Under the deal, ABP will buy the Allen family’s 50 per cent stake in Slaney, creating a new partnership with Linden Foods, which owns the remaining 50 per cent.
The deal will also see ABP move back into lamb processing - via Irish Country Meats - for the first time in decades.
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Mr Healy called on Minster for Agriculture Michael Creed and the Competition and Consumer Protection Commission to address the issue.

IFA report raises further concerns about ABP/Slaney deal


Study claims deal will damage competition in beef processing sector


Irish helicopter financier Waypoint has leased a recently bought air ambulance to the emergency medical services in Ontario, Canada.
The Limerick- and US-based company confirmed that it bought an AgustaWestland 139 helicopter, configured for use by emergency medical services, and leased it to Ornge, which runs the service.
Ornge is a not-for-profit organisation that provides airborne emergency medical services and transport to Ontario. It has the largest fleet of air ambulances in the north American country and is responsible for an area the size of Spain, France and Holland combined.
Welcoming news of the deal, Waypoint chief executive, Ed Washecka said Ornge was an important customer.
“Expansion into the Canadian helicopter emergency medical services market further diversifies our customer base and expands our emergency medical services business, which has been a strategic focus since our inception in 2013,” he said.

Waypoint leases air ambulance to Ontario emergency medics


Irish lessor provides AgustaWestland to not-for-profit Canadian group Ornge


The proposed takeover of Pinewood Studios by an international property fund for £323 million (€379m) has been given the green light by Britain’s financial regulator.
The Financial Conduct Authority (FCA) has rubber-stamped the deal by Aermont Capital, headed by French property tycoon Leon Bressler, to acquire the famous home of the James Bond and Star Wars films.
“The boards of directors of Bidco and Pinewood are pleased to announce that they have received approval from the FCA,” the firms said in a statement. Shareholders will vote on the deal on September 19th.
In July, Pinewood said the plunge in sterling following Britain’s decision to quit the European Union would give it a boost, adding that the impact of Brexit would be “largely mitigated” as its most significant customers are based in the US.
Chief executive Ivan Dunleavy said at the time: “The result of the UK’s referendum on membership of the EU is now known. In the context of our business, the decline in the sterling exchange rate is undoubtedly positive for our international customers.”
Revenues at Pinewood, which is based in Buckinghamshire, grew 10.9 per cent to £83.2 million last year while operating profit soared 136.3 per cent to £13.6 million.
– PA

Pinewood Studios takeover gets a green light


Financial Conduct Authority sanctions Aermont Capital takeover of UK film studio


I was wondering what you think is coming up in the next budget? At present a house is tax free if you’ve inherited it while living in it for a few years, but I read that this is being reviewed. I’d just like your take on this.
Mr J.McJ, email
Answer:
At this remove, it is hard to have any clear sense of what will be in the budget in October, although there has been some fairly clear signalling of an intention to address/reduce the impact of the universal social charge. Ironic really, as it operates more cleanly and transparently than a lot of our tax system.
In any case, the two driving forces shaping the budget will be, first, the Government’s determination to be seen to share some of the benefits of the recovery – especially after the last election showed the presumption of a rising tide lifting all boats was not shared by the electorate. This might be mitigated somewhat by the second influence – the impact of the UK Brexit vote on the Irish economy and the exchequer.
One of the things that has been brought into the mix is the relief you’re talking about – dwelling house relief. I certainly did see some venting in certain media channels on the subject, much of it very exaggerated.
However, it is true to say that the number of families availing of the relief has jumped sharply, and there are concerns in Revenue circles that it is being abused – which it most likely is.
As usual, eagle-eyed tax specialists have been advising their often wealthy clients of the possibility of providing a home for children without any tax implications on. They have been surprisingly open on the subject of such “tax planning”.
Revenue has been clamping down recently on the practice of wealthy parents financially supporting the lifestyles of their adult children. Most recently in the 2014 Finance Act, it tightened up the rules for such support under section 82 of the Capital Acquisitions Tax Act 2003, covering the “support, maintenance and education” of children. The suspicion is that support no longer available under section 82 is now being redirected to dwelling house relief.
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If they have strong grounds to suspect the tax exemption on dwelling houses is being similarly abused, I would expect them to push hard for reform.
Still, the relief is a valuable element of social policy to ensure that family members living with, and often caring for, elderly parents are not effectively forced into homelessness by inheritance tax charges on the death of those parents which forces them to sell the only home they know.
I think, as with the review of section 82, any reform will look to retain the relief for those people who have been genuinely living in the family home for the three years prior to any inheritance with an aged or infirm parent and who subsequently remain in the home (or replacement accommodation) for six years thereafter.
Please send your queries to Dominic Coyle, Q&A, The Irish Times, 24-28 Tara Street, Dublin 2, or email dcoyle@irishtimes.com. This column is a reader service and is not intended to replace professional advice

Abuse of dwelling house relief may see changes to inheritance tax code


Nobel prize winning economist Prof Joseph Stiglitz says the Irish government is wrong to appeal the EU decision on Apple and its tax obligations.
He described comments by Minister Richard Bruton on RTE’s Today with Sean O’Rourke Show, in defence of the government’s position, as ‘utter balderdash.’
On the same programme Prof Stiglitz said: “the fact is that you were encouraging tax avoidance, you knew it.
“Let’s not make any pretence about it, you got a few jobs at the cost of stealing revenues from countries around the world. That’s the kind of activity that has to be stopped.”
He said that the question now was: “what are the rules of the game about tax competition, about state aid and it’s very clear if a company says that they got revenue associated with Ireland, you have to pay a tax on it.
“Whether that income was correctly attributed to Ireland is another matter. If Apple is saying that this is Irish income, you have an obligation to impose taxes on income that they say originated in Ireland.
“Apple is claiming that the income was associated with activities, that’s why they said they could book it to an Irish subsidiary. Can they book it to a subsidiary for activities not occurring in Ireland? The issue is, if they book it to Ireland should there be an Irish tax?
“That’s what the issue is. They were booking it to an Irish subsidiary and they were not paying taxes.”
Prof Stiglitz said he found it mystifying that Ireland didn’t “just pocket that €13billion and use it for the enormous hardship that the people of Ireland have had to face.
“The argument that you will lose lots of jobs is absolute nonsense. It’s a new world, it’s very clear that the rules of the game have changed, under those new rules Ireland will have to compete on the basis of going forward, what it can provide economically.
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“I think Ireland can provide a lot - it has a well trained labour force, a disciplined labour force, and that is the basis on which countries should compete, with infrastructure.
“This idea that all these people will leave and their jobs will disappear is a vote of lack of confidence in Ireland. I’d rather have a vote of confidence in Ireland and say, maybe a few people engaged in cheating, relatively few, but nothing to compensate for the loss of the €13billion.”

Joseph Stiglitz says Ireland should not appeal Apple ruling


Economist says: ‘You got jobs at the cost of stealing revenues from other countries’


1980: Apple sets up base in Cork
1991: Ireland granted first “tax ruling” to Apple, according to the EU, to determine what profits of the company’s Apple Sales International and Apple Operations Europe units in Ireland are payable in this country
2007: Apple’s tax agreement in Ireland is replaced by a second “tax ruling”, according to the EU, on the two Irish-based units
May 2013: US senators John McCain and Carl Levin label Ireland a tax haven for multinational companies such as Apple during hearings in Washington on tax avoidance. The California-based company is accused of avoiding billions of dollars in US taxes by sheltering profits in Irish “ghost companies” which didn’t pay taxes anywhere.
May 2013: Apple says it had paid an effective tax rate of less than 2 per cent in Ireland over the previous ten years
May 2013: McCain and Levin reject the contention by Ireland’s then US Ambassador, Michael Collins, that the State is not a tax haven, as the two men said: “Most reasonable people would agree that negotiating special tax arrangements that allow companies to pay little or no income tax meets a common-sense definition of a tax haven”
June 2013 : EU begins to quiz Ireland, Luxembourg and Netherlands on the legality of various tax deals with companies, including Apple’s arrangements in this country
October 15th 2013 : Minister for Finance Michael Noonan outlines plans to ensure Irish registered companies cannot be “stateless” for tax purposes, closing off a loophole that was used for many years by Apple
June 2014: EU opens formal probes into Apple’s tax affairs in Ireland
September 2014: EU issues preliminary findings, saying Apple’s tax arrangements were improperly designed to give the company a financial boost in exchange for jobs in the country.
October 2015: EU concludes Luxembourg and Netherlands granted selective tax advantages to Fiat and Starbucks, respectively
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November 2015: Apple chief executive Tim Cook says during trip to Dublin that EU probe will not affect Irish operations, as company unveils plans to add 1,000 additional jobs
January 2016 : EU Commission concludes that Belgium granted tax advantages to at least 35 multinationals
August 2016 : EU issues final decision on the Irish-Apple case, saying the Republic must recover up to €13 billion in back taxes from the company; the Government plans to appeal the decision

Apple timeline: countdown to €13bn Irish tax bill


Tax case stretches back to 1991 when Ireland granted the first “tax ruling” to Apple


A young woman has received kudos on social media for offering a more flattering mugshot to media reporting on her escape from a Sydney police station.
Amy Sharp (18) escaped from the Surry Hills Corrective Services Cell Complex just after 3pm on Friday.
The police statement alerting the public to her escape was accompanied by two images they had taken of the young woman, wearing a glum expression and a red blanket over her shoulders.
Both the photos and the statement were shared to Sydney’s 7 News Facebook page.
Almost immediately, Ms Sharp commented on the post from her personal profile with a more flattering image of herself and a simple request: “can you use this photo, please and thank you, Yours Truly, Amy Sharp xx”
Her comment was accompanied by an angelic emoji and had been liked more than 60,000 times at time of writing.
Her public cover picture on Facebook describes herself as “just a lil princess with anger issues”.
She was later arrested just after midnight on Saturday in Wentworth Park, not far from where she escaped.
Despite Ms Sharp’s polite request, 7 News Sydney used her mugshots in a follow-up post alerting their followers to her arrest.
A spokeswoman for New South Wales police confirmed that Ms Sharp was charged with escaping lawful custody as well as an outstanding warrant, and appeared at Parramatta bail court on Saturday.
Guardian Service

Australian fugitive asks media to use more flattering photo


18-year-old Amy Sharp offers Sydney news station alternative in Facebook comment


The new commercial property season gets under way today with the planned sale of four rented office blocks at The Park in Carrickmines, Dublin 18, which are expected to make over €40 million. At that price Savills estimates the investment will show a net initial yield of 6.5 per cent.
Having achieved full occupancy of the four high-quality buildings which date back to 2007, Michael Cotter’s Park Developments is now preparing to begin construction on another five-storey block which will have a floor area of 5,300sq m (57,048sq ft) when completed in 2018.
It will be known as the Hamstead Building, and will incorporate the latest LEED gold standard designs and fit-out for energy efficiency. In the longer term, Park is also planning to build two further office blocks in the park.
The four blocks going for sale are opposite the Iveagh Building which was sold this year to the IPUT pension fund for €14.75 million, reflecting a net initial yield of 6.34 per cent and a overall valuation of €350 per sq ft. The four-storey block included seven retail units on the ground floor.
Park’s success is attracting a range of office tenants has been helped by its close proximity to the retail park, one of the busiest in the Dublin suburbs.
Marguerite Boyle of Savills is planning to sell the four blocks on an individual basis or in a single lot, and expects interest both from institutional and private investors.
Car parking
The overall rent roll is currently €2,725,000, while the weighted average lease term to run is 2.45 years. The development also includes 219 car parking spaces which are rented at €1,000 each.
The largest of the blocks, The Herbert, with a guide price of €24.5 million, will show a yield of 7 per cent and a valuation of €286 per sq ft The five-storey over-basement building extends to over 7,949sq m (85,564sq ft) and is fully let to six tenants including State Street’s international fund services. It is paying a rent of €710,967 for an office area of over 3,049sq m (32,828sq ft). Park Developments is also a tenant in the block, paying €391,825 for over 1,456sq m (15,673sq ft).
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The second lot involves 33 of the 40 self-contained office suites in the Hyde Building which are available at €10.5 million. At this price the investment will show an initial yield of 6.18 per cent and a valuation of €300 per sq ft. The suites are fitted with air conditioning, raised access floors, suspended ceilings and staff facilities.
Retail tenants
Lot number three, Holborne Building, is at the entrance to the park and has two retail tenants on the ground floor, TC Matthews and O’Briens Wines. An even larger space of 556sq m (5,984sq ft) overhead is due to be occupied shortly by a medical user. The overall rent is expected to be in the region of €320,000, reflecting a yield of over 7.6 per cent on the €4 million guide price.
The final lot going for sale is a single-storey building extending to over 167sq m (1,900sq ft) which is primarily let to AIB for a seven-day bank. The management of Park also occupies a small office suite, bringing the overall rent up to €70,768. The €1 million guide price will show a net initial yield of 6.77 per cent and a valuation of €523 per sq ft.
Ms Boyle said the planned sale was a rare opportunity to acquire a significant interest in what was a highly successful park with low vacancy rates. She said the future development of Q3 would further cement The Park as Ireland’s premier suburban retail and business location.


Fully-let offices at The Park are currently producing a rent roll of €2.75 million


Euro area inflation failed to accelerate in August, adding to signs that the euro area’s economic outlook deteriorated ahead of a European Central Bank meeting next week.
Consumer prices rose 0.2 per cent in August from a year earlier, the European Union’s statistics office in Luxembourg said on Wednesday.
The medium estimate in a Bloomberg survey was for an increase of 0.3 per cent.Two months after the UK’s Brexit vote, the 19-state economy is beginning to show signs of faltering, suggesting that more stimulus may be warranted.
Business and consumer sentiment declined, and executives are warning that orders may suffer from political uncertainty.
The International Monetary Fund has already cut its forecast for euro-area growth next year, and the European Central Bank will release new projections after its meeting next week.
ECB president Mario Draghi “is failing to get inflation up to 2 per cent,” Michael Spies, a strategist at Citigroup in Frankfurt said in an interview on Bloomberg TV. “He thinks about what he still can do in terms of quantitative easing and I think that’s the way he’s going to operate - there will probably be more QE and longer QE.”
Policy makers have already deployed a raft of unconventional stimulus that includes large-scale asset purchases, negative interest rates and long-term loans that see banks getting paid for extending credit to companies and households. Still,
inflation remains far below the ECB’s goal of just under 2 per cent, a level it hasn’t reached since early 2013.The Frankfurt-based institution currently predicts price growth will accelerate to 1.6 per cent in 2018.Core inflation slowed to 0.8 per cent in August from 0.9 per cent a month earlier, Eurostat said.
German inflation unexpectedly decelerated to 0.3 per cent, while consumer prices extended their decline in Spain.Euro-area unemployment remained unchanged at 10.1 per cent, according to a separate release.
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The inflation report comes one day after a European Commission survey showed economic confidence declined across most countries and most sectors in a delayed reaction to Britain’s decision to leave the European Union. The data may reopen the debate about more stimulus at the ECB’s September 8th meeting, after the economy’s relative resilience over the summer months led economists including those at JPMorgan Chase and Danske to push back projections for further easing.
Bloomberg

Euro area inflation fails to accelerate in wake of Brexit uncertainty


Consumer prices rose 0.2 per cent in August, less than anticipated


The European Commission is expected to shortly issue its final decision on the way Apple paid tax in Ireland.
How did it start?
In 2013 a key subcommittee of the US Senate held hearings into the tax affairs of various big US companies, amid a growing controversy about how little tax they paid on profits earned outside the US.
The hearings were chaired by high-profile senators John McCain and Carl Levin, and Apple chief executive Tim Cook was among those called for questioning. The hearings highlighted how two significant Apple subsidiaries in Ireland had paid tax of 2 per cent or less on profits over many years, well below the headline Irish corporation tax rate of 12.5 per cent.
The senators dubbed Ireland a “tax haven”, a point hotly disputed by the Irish government. Apple said it had got a tax incentive deal when it came to Ireland in the 1980s, but that it had not received any special treatment – and had established huge operations here that were central to its European operations.
Where did the European Commission come in?
In 2014, the European Commission announced that it was opening an investigation into the tax arrangement of Apple in Ireland, Starbucks in the Netherlands and Fiat and Amazon in Luxembourg.
It is important to understand the basis for these investigations. The EU Commission is claiming that EU member states – including Ireland – offered illegal state aid to the US companies involved. In other words, it is saying Ireland offered Apple a deal that was overly generous and not on offer to other companies.
The commission’s decision will thus be against Ireland – though obviously it has implications for Apple.
So what exactly is the commission looking at?
As with all such investigations, this comes down to specifics. The commission is looking at two so-called “tax rulings” issued by the Revenue Commissioners to Apple in 1911 and 2007.
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These rulings are common and give companies some certainty about how the Revenue will impose taxes. However, in the case of Apple, the European Commission argues that a proper basis was not used for agreeing how Apple would be taxed – and that the Irish Revenue effectively gave the US giant a good deal, in recognition of it providing jobs and investment here.
The details relate to the way Apple accounted for costs and revenues across Europe – and how this led to significant profits for its Irish operations – and the way the profits of its two key subsidiaries here were calculated.
What do we expect the commission to conclude?
The commission already issued a preliminary decision in 2014 saying it believed Ireland offered Apple illegal state aid. It looks certain to confirm this in its final ruling. It will then tell Ireland it must collect tax from Apple that the US company should have paid over the years.
The big uncertainty is the figure. Earlier estimates,largely based on a report by investment bankers JP Morgan, were that the commission could tell Ireland to recoup up to €19 billion – an enormous sum. Expectations are that the final figure will be much lower.
In Dublin the hope is that it can be kept under €1 billion, though nobody knows for sure.
What happens when the decision gets issued?
There will be a storm of international publicity, given the huge international interest in the issue. Rightly or wrongly, other European countries and the US will all feel that some of this tax revenue rightly belongs to them, rather than Ireland.
Ireland and Apple are seen as certain to appeal the decision to the European courts. However the Government may be obliged to issue a tax demand to Apple in the coming months in any case. The legal appeal process could go on for years.
So is this more cash for the exchequer?
It is a potential windfall –but one that the Government does not want. Ironically, the Government will be appealing a decision that a big company must pay it money. The Government will argue that it has no option, given the impact of the negative decision on Ireland’s long-term drive to attract inward investment and the fears it could create among other companies here.
The greater the amount of cash involved, the bigger will be the political controversy over this.
Ministers have been told that if the money is paid to the State at some stage , EU rules would mean that – as it is a once-off payment – it would have to be used to pay down debt, rather than used to fund extra Government spending.
Much will depend on how much cash is involved.
The Government will appeal the decision – no matter what political flak this involved.
But the bigger the amount, the trickier the politics of this will be,both at home and abroad.

Q&A: What exactly is at stake in the Apple tax issue?


Cliff Taylor answers the big questions ahead of the European Commission’s decision


Wearable technology firm Fitbit has opened its European headquarters in Dublin, aiming to employ 50 people by the end of the year.
The firm has appointed former Philips and Harman International executive Des Power as managing director to oversee the new office, which will include sales, marketing, operations, finance and customer support staff along with senior management roles, and will support the Europe, Middle East and Africa region. The company said it has room for up to 100 staff by the end of 2017 based at its Baggot Street office.
“We’ve seen Dublin become a strategic hub for the technology industry as a centre for innovation and sourcing top talent in the region, and we look forward to building a strong team here to complement our offices around the world,” said Fitbit chief executive and cofounder, James Park. “I’m excited to welcome Des to the team and back to his native Ireland. I have great confidence in our ability to further expand our business and help people across EMEA lead healthier, more active lives.”
The decision to open the Dublin office came following significant growth in Europe, with revenue rising 150 per cent year on year in the second quarter of the year.
The news was welcomed by Minister for Jobs, Enterprise and Innovation Mary Mitchell O’Connor.“Today’s announcement is a further recognition of Ireland’s appeal as an international hub for successful companies such as Fitbit,” she said. “Fitbit is one of the world’s most popular and fastest growing health and wellness companies, and I am delighted that they have selected Ireland as the location for their EMEA headquarters as it will provide exciting employment opportunities for our skilled workers.”
Fitbit was set up by James Park and Eric Friedman in 2007. The US based firm has since grown its fitness and sleep tracking devices to a global brand, with the most recent figures showing the company has shipped almost 49 million devices globally.

Fitbit opens new European headquarters in Dublin


New office will employ 50 people by the end of the year


Eir is challenging the law requiring it to provide rural phone services under the universal social obligation (USO).
The State’s largest telco believes it should no longer be saddled with cost of connecting uneconomic rural lines with the advent of broadband and mobile phone services.
The company plans to take regulator ComReg to court to have part of USO designation relating to access at a fixed location overturned.
It is due to file a statement of claim with the High Court in the coming days, which will outline its arguments in more detail.
If successful, a major plank of universal service, designed to ensure every person can receive basic telecommunications services, no matter where they live, may become a thing of the past.
“Eir has lodged an appeal in the High Court as we believe Ireland no longer needs a universal service provider for voice services given the commercial rollout of fibre already delivered, future plans for fibre rollout and mobile services in place,” the company said in a statement to The Irish Times.
ComReg declined to comment other than to say that it planned to publish an information note on the issue later in the week.
Under its USO, Eir is obliged to connect homes and businesses in rural areas up to a cost threshold of €7,000 after which the customer must cover part of the connection cost.
The USO also obliges Eir to provide phone boxes in remote locations, publish telephone directories and provide certain disability services, but these services are not thought to part of Eir’s legal challenge.
In July, the regulator re-designated Eir as the State’s universal social provider (USP) for another five years, a move that appears to have prompted the company’s legal challenge.
Ronan Lupton of Alto, the umbrella group for non-Eir firms, disputed Eir’s assertion that the availability of broadband warranted the move away from USO and the company’s specific USP designation, citing the 920,000 homes and businesses, which have been earmarked for state intervention under the National Broadband Plan.
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He also highlighted that Eir’s obligations under the USO mandated the upkeep and repair of the existing telecoms network, claiming that Eir’s performance has been substandard.
Non-Eir companies – Sky, Vodafone, BT and Magnet which use Eir’s network to deliver their own bundles – are in a separate dispute with the former semi-State over fault repair times, which they claims are too long and fall below European industry norms, a claim the company rejects.
Eir has been lobbying ComReg to have the cost of providing rural phone services, which it estimates to be about €10 million a year, shared among providers.
To this end, it lodged a series of retrospective funding claims, dating back to 2010 and totalling €45 million, with the regulator.
Eir reclaims part of the connection costs via line rental charges but argues the overall costs should be shared among operators as customers can choose different service providers when connected.
ComReg has ruled against the first of these claims , while judgments on the others are still pending.
The European Commission is considering introducing a USO for broadband across member states as part of wider plans to revamp its digital agenda.
Minister for Communications Denis Naughten has already signalled his intention to consider introducing such a legal imperative here once the NBP is in place.

Eir launches legal challenge against rural phone services duty


State company believes it should not be stuck with cost of uneconomic rural phone lines


More than 350 jobs are to be created across Ireland with food chain Camile Thai and retailer Harvey Norman both announcing the opening of new branches.
The Brody Sweeney-owned Camile Thai is to create 100 new jobs before the end of the year as it opens three new branches, in Stillorgan and Artane in Dublin, and in Sligo town.
The chain has 10 branches in Dublin and it also operates in Limerick.
Separately, Harvey Norman is to create more than 50 jobs with the opening of a new store in Tallaght, bringing to 15, the number of stores the company has across Ireland.
The new store will boast almost 60,000sq ft of retail space, a 250-space carpark, 42 cycle-park stands and a cafe.
Recruitment for the new roles is to commence in the coming weeks, the retailer said.

Jobs boost as more than 350 new roles promised for Ireland


Thai food chain Camile Thai to take on 100 staff while Harvey Norman also recruiting


In the background to the difficulties that Mayo Renewable Power has encountered with finance are problems that could affect many other Irish businesses.
The projects’s US backer, Weichert Enterprises, has provided €90 million of the €180 million required, €10 million more than it originally committed. However, a number of factors conspired to ensure that its three lenders, AIB, Ulster and British bank, Barclays, did not contribute any of the €118 million that they originally signed up to provide.
Barclays pulled out earlier this summer because of the uncertainty surrounding the UK vote to leave the EU. All three banks had to sign off on the company’s decision to change the supplier of a boiler, a key component for its proposed electricity generator in Mayo, and this delayed funding. A lawsuit in the US further compounded its problems.
Commentators say that one of the consequences of the financial crash and subsequent downsizing of the banks eight years ago was the loss of expertise needed to lend to projects such as the renewable power plant that the company is building.
Lending to utilities is a specialised business, normally done by teams within each bank that have built up expertise over a period. As the Irish lenders effectively shut up shop in the closing months of 2007, those teams left, taking their expertise with them.
The banks are only now rebuilding those teams, meaning that big ticket projects, with the potential to deliver real wealth and jobs to the country, could face delays getting finance here, or will have to look abroad.
The consequence of their having to go abroad is, of course, that some of the wealth they create will end up gracing someone else’s balance sheet, instead of being recycled back into the Irish economy, where it belongs.

Banks lacking expertise in lending to utilities


Mayo Renewable Power’s difficulties are problems that could affect many businesses


Plastics manufacturer and waste manager One51 has reported a 51 per cent increase in group revenue to €214.6 million for the first-half of the year.
Earnings (Ebitda) grew by 105 per cent to €27.2 million during the six months ended June 30, while pre-tax profit climbed 37 per cent to €11.3 million.
The profit for the period after tax and exceptional items amounted to €8.9 million.
Net debt increased since December 31st 2015 by €26.5 million to €146.8 million at period end.
One51 group chief executive Alan Walsh said the second half of the year started satisfactorily across all divisions with a number of significant capital investment projects undertaken in the first half of the year now coming into production.
He said the interim results were ahead of expectations, in large part due to the strong performance of IPL, the North-American acquisition made in July 2015.
“We have successfully integrated the transformative IPL acquisition into our plastics division. That business, which has performed ahead of expectation since acquisition, delivered very strong results during the first half of the year.”
However, he said UK earnings were adversely affected by the fall in the value of sterling in the wake of Brexit.
“Other potential impacts of Brexit are difficult to assess currently but should become clearer in the second half of the year.”
Revenues increased by 43 per cent to €25.3 million at One 51’s specialist environmental services division, ClearCircle, primarily as a result of an increase in project related work in Ireland and a contribution from the acquisitions in the UK. Ebitda increased by 42 per cent to €2.7 million.
Plastics and waste
One51 makes wheelie bins and other plastic products, manages hazardous waste and holds a number of investments.
One51 revenues jumped 32.4 per cent to €366 million last year, while Ebitda jumped by 67 per cent to €36.1 million.
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In April, One51 was forced to pull plans for a stockmarket flotation after objections from some of its major shareholders. Among those believed to have objected were Dermot Desmond’s IIU, which owns around 23 per cent of the company. Among the contentious issues were believed to have been plans to dilute existing shareholders by bringing in new investors ahead of the float. Other major shareholders include a number of other co-ops, including Kerry, and a company owned by Larry Goodman.

Plastics company One51 first-half profits jump 37% to €11.3m


Interim results ahead of expectations, mainly due to strength of US acquisition IPL