Friday 20 October 2017

Kingspan 'unlikely' to pursue appeal, says chief

John Mulligan

John Mulligan

Insulation group lost €48m High Court case in London

GENE Murtagh, the chief executive of Cavan-based insulation group Kingspan, has said the company is "unlikely" to pursue an appeal after it lost a €48m High Court case in London last week.

Kingspan had sued Austrian firm Borealis, claiming it had supplied a sub-standard polyethylene product that had resulted in plastic oil tanks made by the Irish company degrading.

The judge hearing the case insisted the cause of the failures was most likely due to errors in Kingspan's manufacturing process.

Speaking after Kingspan's AGM in Dublin yesterday, Mr Murtagh said that he disagreed with the judge's ruling, but that the company probably won't appeal.

"We just don't have the appetite. Litigation isn't our game," he said. He added that he "absolutely" did not agree with the judge's findings.

Mr Murtagh also said yesterday that a slight pick-up in Irish building activity that Kingspan had witnessed in past months had now come to a halt.

"I'm on the optimistic side of this, but surprisingly Ireland in the past three or four months seems to have drifted," he said.

"We were showing improvement up until not long ago," he said.

"What's holding our business up here very much is refurbishment. New build just doesn't exist. Just when you thought it was at its lowest, it's gone again."

Kingspan said yesterday that its sales rose 8pc to €473m in the first four months of the year.

Sales in mainland Europe, which accounted for 38pc of its €1.55bn revenues last year, were 9pc higher in the period, while in the UK, which accounted for 39pc of turnover last year, sales were up 2pc. In North America, sales rose 10pc.

Kingspan said that while the year had begun with "relatively more optimism" regarding potential activity levels, that dissipated somewhat as the quarter progressed.

Mr Murtagh also said that Kingspan was recently edged out of a $145m (€112m) race to buy Metl-Span -- US unit of an Australian group -- to private-equity group NCI.

Pushed

"There's a limit to what we'll pay. At the end of the day, we're after returns. We felt the levels it was being pushed to just didn't make sense for us," he said.

He said the company is still engaged in a process that could see it acquire a unit of Germany's ThyssenKrupp.

Mr Murtagh also said Kingspan has made contingency plans in the event that Ireland rejects the Stability Treaty.

"We clearly have thought of different scenarios, as you'd expect us to, but if we were to plan for every iteration that we hear then I think we'd do nothing but plan for different scenarios.

"We'll react accordingly, but you won't get a knee-jerk from Kingspan. We're not running away or we're not changing domicile."

Irish Independent

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