Wednesday 22 May 2019

What it says in the papers: business pages

Paul O'Donoghue

HERE are the main business stories from this morning's papers:

Irish Independent:

***Greece was last night urged to get back to the negotiating table to avoid a “catastrophic” fate after talks between Eurozone finance ministers ended without the prospect of a deal.

Attention shifts now to an emergency summit of European leaders set for Monday to break the deadlock and avoid a potentially damaging default, which could lead to a possible exit by Greece from the Eurozone.

European Economics Commissioner Pierre Moscovici branded the situation extremely difficult and worrying, and warned that the endgame nears.

***The owner of Britain’s Hovis looks to be in the driving seat at Irish Pride after buying the company’s debt and replacing receivers who were appointed only last week, the Irish Independent has learned.

The move will prompt speculation that Britain’s third biggest bread producer is poised to snap up Irish Pride, potentially saving up to 340 jobs here.

However, sources insisted last night that a full and open auction process is still underway, with a number of initial bids for Irish Pride submitted and that no deal to buy the business has been agreed.

***Significant leading banking and business figures lobbied the Government and its senior officials for a guarantee in the months before September 2008.

In evidence to the Oireachtas Banking Inquiry, former Secretary General Kevin Cardiff, revealed under oath that among those arguing for a guarantee were former Finance Minister Charlie McCreevy and businessman Dermot Desmond.

Mr Cardiff also told the inquiry that he and Finance Minister Brian Lenihan argued against a blanket bank guarantee on the night of September 29, 2008.

Irish Times:

***Irish accounting and legal professionals are railing against plans by the Organisation for Economic Co-operation and Development (OECD) to overhaul global business tax rules, the Irish Times reports.

In a submission made to the Paris-based organisation the Consultancy Committee of Accountancy Bodies Ireland, which represents about 40,000 accountants, expressed “serious concern” about the new rules which are being introduced in an effort to minimise tax avoidance by multinationals.

It said: “[The] provisions are fundamentally biased in favour of larger countries and economies. Countries like Ireland which depend on foreign investment will face much more restrictive conditions compared to larger economies.”

***Businessman Denis O’Brien is hoping to fetch almost €60m with the sale of his Gulfstream jet, the Irish Times reports.

According to the newspaper O’GaraJets in Atlanata is selling the Gulfstream G650 S/N 6032 which was bought by Mr o’brien as new in 2013. The plane has flown for 1,734 hours in the time since, making 558 landings.

It is not clear how much the businessman paid for the plane. No comment on the sale was available from Mr O’Brien last night.

***There will be no 30-day grace period for Greece if it misses its repayments to the International Monetary Fund at the end of June, the organisation’s managing director Christine Lagarde said yesterday.

The head  of the ESM bailout fund Klaus Regling confirmed that the outstanding €7.2bn due to Greece under its stalled bailout plan will expire if the bailout agreement is not renewed on June 30th.

Earlier finance Minister confirmed that Ireland is consulting with the ECB on contingency plans relating to the possibility of Greece leaving the eurozone.

Irish Examiner:

***Hotel prices in Dublin are 30pc higher than the national average, according to a new study.

The survey, carried out by hotel search website, also shows that the capital is the most popular destination for those on holidays in the summer in Ireland even though hotel prices have shot up by 17pc, or €22, on average per night during the last year.

Dublin is the most expensive location for a hotel room per night in the country, with average costs of €150 per night. Galway and Killarney ranked second and third respectively with prices of €121 and €120.

***The Government has said that there is no need to re-evaluate its taxing policy for exploration companies active in Irish waters, the Irish Examiner reports.

According to the newspaper the principal director at the Department of Natural Resources’ Petroleum Affairs Division Ciaran O’hObain was asked whether the Government would have been advised differently on the tax framework for oil given the current collapse in oil prices.

The Government changed its tax policy last year so that the top rate of tax made on future oil finds in Irish waters was increased from 40pc to 55pc with a 5pc royalty going to the State for each year of a producing field’s lifespan. Mr O’hObain said the issue will not be revisited.

***Oil producer Dragon Oil’s largest independent investor the asset management firm Baillie Gifford, has said an increased takeover offer from majority owner Emirates National Oil Company (ENOC) “materially undervalued” the company.

ENOC, which owns 54pc of Dragon Oil, raised its bid to buy out minority shareholders to 750p (1,045c) per share on Tuesday, valuing the stock it does not already own at about £1.7bn and an overall takeover at £3.7bn; up from a previous proposal of £3.6bn.

Baillie Gifford, Dragon’s second-biggest investor after ENOC, with a 7.2pc stake, said the improved offer does not fully value the firm’s growth potential. The move sets the stage for other significant minorities to hold out for an improved bid, said Alex Olvera, event driven analyst at Makor Securities.

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