Monday 20 November 2017

The quiet Tipp man who became king Louis of the capital's pub scene

Pub supremo Louis Fitzgerald bought the Stag’s Head for €5.8m
Pub supremo Louis Fitzgerald bought the Stag’s Head for €5.8m
Stag's Head pub, Dublin
John Mulligan

John Mulligan

When Tipperary man Louis Fitzgerald moved to Dublin in 1962, there was little indication that he would end up being one of the country's most successful publicans and hoteliers.

His portfolio includes some of the best-known pubs in Ireland, including the Stag's Head and Kehoes in the capital, as well as the Quays bar in Galway.

The quiet-spoken and amiable Cappawhite native turned 71 last month, and has assembled a formidable leisure business that managed to keep its head above water during the downturn at a time when many rivals were dashed against the rocks.

And documents filed this week at the Companies Registration Office confirm the finishing flourishes to the paperwork of a 2014 refinancing of his group. That refinancing involved AIB, and Broadhaven, a joint venture between Sankaty Advisors and billionaire Dermot Desmond. Fitzgerald's company had previously relied on Anglo Irish Bank and Ulster Bank for its finance.

The 2014 reorganisation showed just how healthy the business remains, with one of the companies in the group having had shareholder funds of almost €73m just prior to the restructuring.

While it was reported this week that the group had paid a €66m dividend to the Fitzgerald family, the reality was that it just seemed that way because of the way the restructuring was undertaken, with funds funnelled to different group entities. It's believed the actual dividend paid to the family was a much more modest sum of between €750,000 and €1m.

That appears much more in line with the modus operandi of the low-key businessman.

Pubs were for many years the mainstay of the business, but Fitzgerald later branched out into hotels, restaurants, car parks, and even a British football team.

The GAA fan, who remains a loyal supporter and backer of his home county, acquired the Arlington Hotel in 2005 from businessmen Cyril Mulligan and Tom Quinn. He paid over €30m for the property.

In 2008, the bought what was then the Parliament Hotel in Dublin's Temple Bar, and renamed it the Arlington Temple Bar. He also built the Louis Fitzgerald hotel on the Naas Road - a greenfield development that cost about €30m.

And his wife, Helen, has been instrumental in helping to run and grow the business. So too have his five adult children, most of whom are involved in the group.

When he got into the hotel sector, Fitzgerald had considered inking a deal with an international chain to manage that side of the operation. But he wanted to retain control of the business.

"It was a major decision for me and the advice at the time was that I should brand it," he told the Irish Independent in a previous interview.

"I wanted to have a family business and to control the management of the hotels. If I had taken in a major hotel operator I wouldn't have been able to do that."

So he wondered about using his own name above the door instead. He hired consultancy groups to come up with ideas for a name for the first hotel. The Louis Fitzgerald name was their first choice.

"I was a bit surprised," said Fitzgerald. "I thought they'd come back with some fancy name. I had reservations about that because I wasn't used to doing it with the pubs."

It was his wife who ultimately persuaded him. "I really went for it then," he said.

He's taken punts on other things too. He was one of the members of the so-called Drumaville consortium that in 2006 paid £50m (then €63m) in cash and assumed debt to buy Sunderland football club.

That acquisition was spearheaded by Niall Quinn, while fellow publican Charlie Chawke was also involved. Roy Keane had managed Sunderland up until December 2008.

The investment was a painful one. In 2008, Irish-American businessman Ellis Short took a 30pc stake in Sunderland, nicknamed the Black Cats, and in 2009 he bought out the rest of the Drumaville holding.

That left the Irish consortium nursing as much as £15m loss on their total investment.

It's in pubs and hotels where Fitzgerald's real interest remains. He paid €5.8m for the Stag's Head in 2005, which was €800,000 more than the guide price.

"I'm always unhappy on the day I buy a pub, but I'm very happy the following morning," he once said.

Irish Independent

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