Mueller tetchy over Aer Lingus review; happy times at Radio Nova; Hoops looking at €1m payday; good news for Denis O’Brien; Irish law firm looks east
Radio Nova celebrates 5% reach in first year
CLASSIC ROCK station Radio Nova celebrated its first year on air last night with a party in Café en Seine with advertisers and about 800 of its listeners.
With a 5 per cent reach in its first year – it had targeted 4 per cent in its licence application – there was much to celebrate for the station, which broadcasts in the greater Dublin area.
Its backers are now planning to launch 10 digital radio stations to spread its rock gospel.
They will play wall-to-wall rock music of various genres 24 hours a day and, says chief executive Kevin Branigan, will cost less than €100,000 to put on air.
Nova hopes to secure a sponsor for the digital stations.
With its first year just closed, Branigan is circumspect about Nova’s financial performance, saying only that it was “on target with the business plan”.
Nova’s licence application forecasted turnover of €1.35 million in year one and a loss of €1.54 million.
While the listenership figures have been good, Branigan concedes it has been a tough slog to secure advertising.
“We’ve had to work hard for a breakthrough with national brands. It’ll be about trying to get on their schedules for November/December.”
Branigan attributes its early listenership success, in what is a crowded market, to people being a “little jaded” with existing “pop-oriented” channels.
“But we’re under no illusions about what’s ahead of us. It’s a matter of keeping the head down and focusing on being the best we can.” Not exactly rock’n’roll, but probably a wise strategy.
Aer Lingus mute on review finding
JUDGING BY this week’s interim results, Aer Lingus would prefer to sweep under the carpet the results of the external review of its controversial leave-and-return redundancy scheme in 2008, which left shareholders picking up a €30 million tab.
Chief executive Christoph Mueller wouldn’t divulge anything about the findings and recommendations from the report at a press briefing. He became slightly tetchy about the matter when pressed before shutting down the subject altogether.
In fairness to Mueller, this fiasco happened before his time. There’s no upside to this for him – just flak.
We were told the board had received the report, and that the recommendations have been substantially implemented.
It was a highly unsatisfactory answer, especially when you consider taxpayers own 25 per cent of the business.
To recap, in 2008, about 715 Aer Lingus staff walked out the front door with redundancy payments under their arms, only to re-enter the building through a rear entrance some weeks later to fulfil similar roles on lesser terms and conditions.
This was a scheme presented by the unions to allow workers to get tax-free lump sums, and the airline to claim redundancy rebates from the State.
We can’t be entirely sure, but it appears the arrangement went through on a nod and wink from the Department of Enterprise, its then minister Mary Coughlan and the National Implementation Body (NIB).
It came unstuck when the Revenue Commissioners decided, rightly, that these were not actually proper redundancies. Aer Lingus then settled the bill.
The airline’s board has now decided the matter is closed, and it will not be sharing the results of its review – rumoured to have cost a six-figure sum – with shareholders.
All we know is there were no adverse findings against the senior management of the time, including former chief executive Dermot Mannion.
We’re left to ponder on what conclusions were made in relation to the roles of the department, NIB and the trade unions.
Will Aer Lingus seek compensation on behalf of shareholders from any parties?
So far, Ryanair, Aer Lingus’s biggest and bolshiest shareholder, has kept its powder dry on the matter. But for how long?
Hoop dreams coming true with €1m payday
AFTER YEARS of heartache and plenty of ribbing from rival fans, I took great satisfaction in Shamrock Rovers making the group stage of the Uefa Europa League in Belgrade last week.
What will it be worth to the club? The intention is to keep the three group games – Rubin Kazan, Paok and Tottenham Hotspur – in Tallaght.
To do that, it will have to install at least 2,600 seats to meet Uefa capacity requirement of 8,000-plus. Uefa is set to make a ruling on this next Tuesday.
Mark Lynch, a director of Shamrock Rovers, estimates that gate income, net of all costs, could exceed €200,000 in Tallaght.
The club will also get a whopping €1 million fee from Uefa for reaching this stage and €70,000 for each draw and €140,000 for every group win.
A couple of positive results could yield another €200,000-plus.
“This is a breakthrough moment for the profile of the club,” Lynch said. “We’re now viewed positively in a league where the news is often negative.”
Rovers had turnover last year of €2.1 million, making a small profit. This puts the Uefa windfall into perspective.
“We want to do it again,” Lynch told me. “But it’s not a goal that we’re going to chase in a foolhardy way. We plan to continue investing in the structures of the club.”
Keep on Hooping.
Go-ahead for Digicel merger in Jamaica
SOME GOOD news this week for Denis O’Brien and his Digicel operation in the Caribbean.
The government in Jamaica approved Digicel’s merger with rival Claro, owned by Mexican moneybags Carlos Slim.
But prime minister Bruce Golding also signalled that regulation would be beefed up in a bid to protect competition.
This will no doubt be welcomed by Lime, the other mobile operator in Jamaica, owned by Cable Wireless.
Lime has been lobbying for some time to have interconnection retail charges equalised. At present, Digicel is able to charge a higher fee to Lime for interconnection than vice versa.
This dates back to the time of Digicel’s launch and was initially to allow it to compete with Lime, which was the incumbent and the then dominant player.
Digicel/Claro will have a near 80 per cent share in Jamaica, which is where O’Brien made his mobile debut in the Caribbean.
Digicel boosted its revenue in Jamaica by 8 per cent in its first quarter.
The deal is part of a wider transaction between Digicel and Slim that involves the Mexican acquiring O’Brien’s operations in El Salvador and Honduras.
These have yet to get regulatory clearance. In the meantime, Digicel and Claro will continue to operate independently in Jamaica.
Eastern promise for Irish law firm
WITH CHINA now a bigger player on the global economic stage, Irish law firm Dillon Eustace has decided to pitch up a tent in Hong Kong.
The firm, which specialises in financial services, plans to offer advice to Asian investors and groups who might consider Dublin as a gateway into Europe.
The IFSC is recognised as a leading player in relation to the domicile of investment funds and Dillon Eustace plans to tap that market with Chinese clients.
Partner Paul Moloney has been dispatched to the island – tough gig but somebody’s got to do it – where he is essentially working on his own for now.
Doing business in Asia is nothing new for Dillon Eustace. It opened a Tokyo office in 2000 and already has a roster of clients in the region.
Over the past decade, the economic influence has shifted away from Japan and moved to China.
“Our focus is more Hong Kong than Tokyo now,” Dillon Eustace managing partner Mark Thorne told me this week.
“We already have a lot of Asian clients, including a number of leading banks and insurers. Our name is already reasonably well known there so, hopefully, it will go well for us.”
The Dublin-based group has 32 partners and 165 staff here but as with most other Irish law firms it does not reveal its fee income.
Little things
WITH M&A activity in Ireland thin on the ground in the recession, corporate finance groups here are increasingly looking abroad to find deals.
Last week it emerged that Dublin-based Key Capital – founded by Conor Killeen, Kyran McStay and Ken Mintern in 2003 – advised NM Rothschild, the private investment bank controlled by the wealthy Rothschild family, in its acquisition of Elgin Capital, the manager of €1.4 billion worth of leveraged loan assets.
In the press release, Phil Yeates of Rothschild said Key Capital had facilitated the transaction through its knowledge of the Elgin business, [its] valuation expertise and [its] previous experience in advising debt management teams on acquisitions.
It’s a handy reference as it looks to secure other advisory roles abroad.
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NATIONAL GEOGRAPHIC Channel has been in town filming at the Guinness brewery in St James’s Gate for an episode in its Megafactories series, which will air in early 2012 in 163 countries.
It will be a behind the scenes look at how the famous Dublin brewery operates and will also include a segment on Arthur’s Day, which takes place on September 22nd.
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MCSQUARED, THE consumer offshoot of Murray Consultants, has retained the Love Irish Food PR account following a tender process. Love Irish Food was launched in 2009 and its members include Avonmore, Ballygowan, Cully Sully and Barry’s Tea. A new marketing campaign has been launched supported by a six-month PR programme.
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STATE STREET Corporation’s global vice-chairman Joe Antonellis is in Kilkenny today to mark its 10-year presence in the city.
State Street’s asset management arm here, SSgA, continues to beef up its fundamental equities team. It has added Jeremy James of Pioneer Investments and Mark Prentice from Goldman Sachs to the desk.
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DUBLIN ZOO hopes to attract more than €1 million in corporate sponsorship over the next five years to help fund infrastructure improvements.
Banana group Fyffes swung into action this week by lending its name to the gorilla enclosure in a five-year deal. The elephant trail and African savannah are also up for grabs.
