Wednesday 13 November 2019

Running the rule over State's most prized assets

Government must work hard to get best prices for companies

Siobhan Creaton



Employees: 7,783

Value: €4bn

Recommendation: The transmission grid and all hydro units should be transferred and operated by EirGrid and kept in public ownership. ESB should sell its remaining power stations, its international businesses and energy supply and distribution operations.

Its prospects: The jewel in the crown will be broken up and sold off piecemeal to international bidders. This is a profitable company that pays healthy dividends to the Government and is the dominant energy supplier in Ireland. Splitting it up and selling off its various parts could realistically take a couple of years. The company's large pension deficit of about €2.2bn will also have to be sorted out before the Government can get its hands on the billions it is looking for.

Bord Gais

Employees: 1,006

Value: €1.4bn

Recommendation: Its transmission and interconnector assets should continue to be state-owned and could be merged into EirGrid. The rest of the company should be sold.

Its prospects: This company could be sold to an international energy group more quickly than the ESB, possibly within a year, but it will raise less money for the Government. The divestment of its transmission business will have to be completed as part of the sale process which at the earliest could happen some time next year.


Employees: 305

Value: €90.3m

Recommendation: Targets that require EirGrid's transmission capacity to double by 2025 should be reconsidered in light of greater access to the European grid and the integration of a greater proportion of wind energy.

Its prospects: EirGrid is seen as a vital piece of infrastructure that will be expanded to include the ESB and Bord Gais transmission operations. It will not be sold in the near term. Fears that it could undermine the country's energy supplies will keep it in Government hands.

Bord Na Mona

Number of Employees: 2,136

Value: €224m

Recommendation: The Government should sell Bord na Mona in its entirety, to include selling the peat extraction rights but not the land it owns.

Its prospects: To get the best price for this company, the Government has a bit of work to do. Following models such as that used in New Zealand to licence the land rather than selling it of in its entirety will involved adopting new structures that are commercially attractive. A new owner will want to know exactly what the licence allows them to do and be clear about Government policy for the use of peat as energy.

Total money that could be raised from Ireland's energy companies: €5.75bn


Dublin Airport Authority (incl Cork and Shannon Airport)

Number of employees: 3,103

Value: €976m

Recommendation: The Dublin Airport Authority should sell its international businesses to pay down debt and in time Ireland's airports should be sold.

Its prospects: Ireland is one of the few European countries where the Government still owns the airports. If the DAA's debts were reduced, it could be sold, but this will take some time. New terminals in Dublin and Cork have saddled it with a heavy debt burden. Much will depend on whether the Government considers airports to be strategic assets that should not all be sold.

Irish Aviation Authority

Number of Employees: 672

Value: €6.3m

Recommendation: The Government should look at merging it with Britain and Europe's air traffic control services.

Its prospects: This business could be sold easily enough. Most of Europe's traffic control systems have been taken over by private operators and this could be merged with the UK's Nats. The amount of money the sale of the IAA would raise is small change in the context of the billions the Government needs.

Dublin Port Company

Number of Employees: 157

Value: €238m

Recommendation: All of Ireland's ports should be restructured into several port companies built around Dublin, Cork and Shannon Foynes and some or all should then be sold.

Its prospects: Dublin Port is the most attractive port as it makes healthy profits and has become the main point of access for road haulage since the port tunnel was completed. It would attract buyers. The future of the other ports would have to be tackled if the Government accepts the report's recommendations. This would include merging some of them and making them more viable which could be a lengthy process. For strategic reasons, the Government may be reluctant to sell all of the Irish ports.

CIE (incl Dublin Bus, Irish Rail, Bus Eireann)

Number of Employees: 11,463

State subsidy in 2009: €316m

Recommendations: The Government could sell CIE Tours and privatise all or part of Dublin Bus once it has created a model for competition for the bus market in the Dublin area.

Its prospects: There won't be anyone queuing up to buy CIE, but private operators will be interested in muscling in on some of the more profitable bus routes that could be put out for tender. The recommendations, if adopted, will no doubt trigger huge opposition from the unions representing workers there and could make it a long and drawn out process.

Total money that could be raised from Ireland's transport companies: €1.22bn


An Post

Number of Employees: 10,086

Government Subsidy 2009: €39.8m

Recommendation: The Government should hold an open competition for bidders to take the National Lottery, which is operated on behalf of An Post, when it comes up for renewal at the end of this year. Otherwise An Post's precarious financial position means it could not be sold quickly.

Its prospects: With huge debts and in need of a government subsidy to stay afloat, bidders won't be rushing to buy this state asset. The focus will be on driving down costs in that business and reducing staff numbers to put it on a firmer footing, but union problems will make this a tricky process.


Number of Employees: 2,297

Value: €145.4m

Recommendation: The Government should sell RTE Networks, the company responsible for the transmission of its radio and television output. It should also increase the portion of the licence fee allocated to the Broadcasting Fund to above 7pc and TG4 should be funded from within its own revenues.

Its prospects: A new regulatory structure would have to be adopted to clear the way for the sale of RTE Networks which may take some time to complete. Such a radical move would leave RTE to operate as a programme maker. The recommendations could prove difficult for TG4 as it will further reduce its revenues.

Total money that could be raised from communications companies: €145.4m

Natural resources


Number of Employees: 1,170

Value: €1.2bn

Recommendation: The Government should sell Coillte's forest and non-forest assets without selling the land. It should consider offering a licence that could be sold to a prospective buyer.

Its prospects: It owns about 7pc of the country's land mass but much of this is bog land and forest. Just how much it would get by selling licences to use the land will depend on the terms it offers. Some of Coillte's land is not under forest and will be sold separately. This should attract strong interest from the farming community. However, selling our state forests won't be without controversy.

Other assets

Aer Lingus stake

Recommendation: The Government could sell its 25pc stake in Aer Lingus as soon as it is opportune.

Its prospects: This will raise just over €110m but much will depend on what happens to Ryanair's 28pc stake in Aer Lingus. There will be concerns about who ends up owning this airline because of Ireland's position as an island economy on the edge of Europe. Access to the UK and Europe is particularly important and the Government would be seeking guarantees in this regard. The European Commission has ruled against Ryanair taking over Aer Lingus but doesn't have the power to force the airline to sell its stake. An ongoing investigation by the UK's Office of Fair Trading though could affect what might happen in the future and may present an opportunity for the Government to sell its shares.

Irish National Stud Company, Horse Racing Ireland, Bord na gCon

Recommendation: The National Stud should be sold. Horse Racing Ireland should sell its racecourse interests if it got a commercial price for them and Bord na gCon should sell its interests in greyhound tracks.

Its prospects: The Irish National Stud could be attractive as a trophy asset for rich racehorse breeders. It is a huge tourist attraction and could attract buyers on this basis alone. We're a country famed for the quality of our horses and the National Stud has superb facilities. Those who have the money and interest in horse breeding such as Arab oil chiefs may come knocking for this asset.

Total value of Ireland's major semi-state companies: €8.3bn

Irish Independent

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