Tuesday 24 October 2017

Both sides at One51 dig in for a fight to the finish

John Mulligan and Peter Flanagan

NON-EXECUTIVE directors at investment group One51 have remained silent on the widening fracture between dissident shareholders and chief executive Philip Lynch, refusing to comment on the public bust-up.

Contacted by the Irish Independent yesterday, One51 non-executive director James Murphy, who is a member of the company's remuneration committee, declined to comment on the increasingly acrimonious corporate battle.

Mr Murphy is also a director of a company called Chandela, which forms part of an opaque corporate structure used by One51.

In 2008, One51 transferred nearly €5m to a subsidiary called Protech Performance Plastics, which in turn transferred the money as a tax-free payment to Chandela. About half of that money has been paid to unnamed executives.

Despite reports to the contrary, a spokesman for One51 said Chandela was part of the One51 Group and as such "fell within the One51 board's governance structures".

Another non-executive director, Hans Droog, asked whether he and fellow non-executive directors still supported Mr Lynch and One51's strategy, also declined to comment, citing board confidentiality.

Other non-executive directors had not returned calls by the time of going to press.

They included Noel Cawley, who is also chairman of the state agricultural agency Teagasc; Eithne Fitzgerald, a partner with law firm A&L Goodbody, who is also its head of corporate finance; former Fine Gael minister Ivan Yates, who owns Celtic Bookmakers; and Hugo Maguire, the chairman of Town of Monaghan Co-Operative Society.

Earlier, the 'Campaign for Change at One51', which is led by Gerry Killen, dismissed the interim results that One51 published yesterday and reiterated its call for greater transparency within the company.

"While the results point to an increase in turnover and earnings before interest, tax, depreciation and amortisation (EBITDA), the results are unaudited and shareholders can take no comfort that they represent a true and fair reflection of the first half performance of the group," said the group.

One51's interim results showed an increase in EBITDA of 14pc to €26m, while the operating profit jumped 18pc to €18m.

The company also said its environment services division had completed the acquisition of the UK hazardous-waste operator Alchema and that One51 had invested in two renewable-energy companies in the US.

These investments apparently mean that more than three quarters of One51s investments are now in the clean-tech sector -- a key demand of the rebel shareholders.

Mr Lynch was upbeat on the results, commenting: "One51 is performing ahead of budget and generating strong operating cash flows. Its considerable portfolio of investments is performing well and yielded cash dividends of more than €4m during the period."

Nevertheless, the Campaign for Change remained unmoved.

It said: "The fact remains that three quarters of its investments are minority stakes, with no possibility of providing a meaningful return in the short to medium term.

"The group's executives and board must embrace change if a coherent and clearly understood business is to be created that will restore shareholder value and deliver meaningful liquidity."

Irish Independent

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