The wives, the women, the scandals ... Liam Collins takes a look at the champagne lifestyle of the Smurfit clan
HE conventional wisdom in business is that the first generation builds it, the second consolidates and the third comes along and ruins it. But it doesn't look like Smurfits is ever going to get as far as the third generation. Michael Smurfit, who built the multinational paper and packaging conglomerate, is preparing to sell out. In this fiercely competitive business you either keep expanding or you sell out, and he just doesn't have the stomach to go on an aggressive acquisitions trail again.
"There has been a mood in the company for some time that it has gone as far as it can go," said one insider. Although a ?3bn company is huge in Irish terms, in international terms it is still a small multinational.
In the last year there have been 40 takeovers in the packaging business worth ?30bn as manufacturers consolidate, trying to slash costs and capacity. Madison Deeborn, now in talks with Smurfit, have bought two major paper companies in the United States. Smurfits are now talking to them about a sell-out that will net hundreds of millions for the family and shareholders. But they will also be secretly hoping that International Paper, a ?25bn American corporation, may come in with a counter bid, driving up the share price which had been sluggish till last week still further.
The big loser in the Smurfit price rise is former Taoiseach Albert Reynolds, who holds no shares in the multi-national where he has been a director for a number of years. With the value shooting up by 17 per cent last week, the big winners will be the three remaining brothers Michael, Dermot and Alan and former chief executive Howard Kilroy, who in the last two months has moved more than seven million shares out of his own name and into nominee accounts. While the business community is looking at the share price and possible predators for Smurfits, the ordinary public are looking again at a family name that has become a by-word for wealth and high living.
But it isn't only the Smurfits who will benefit. Thousands of Irish shareholders will walk away better off from any takeover. One of them is Ray MacSharry, the former Finance Minister, who has a shareholding worth about ?15,000 and is a director of Smurfits. However, walking away with more than a ?1m will be businessman Ben Dunne, who has a holding of 360,000 shares.
A takeover would also end one of the great blood sports in Irish business, the annual bitch about how much Michael Smurfit gets paid for running the company he built into a conglomorate.
AT THE opening of the K Club the then Taoiseach Charles J Haughey and Michael Smurfit, chairman and chief executive of the Irish multi-national, sat side by side at the top table in the opulent dining room of the Kildare mansion turned country club.
White-gloved waiters approached from either side with bottles of wine. History does not record what vintage Charles Haughey drank that day, but it was wasn't a glass of ?1000 a bottle Chateau Petrus which was poured into Michael Smurfit's crystal glass by his personal wine waiter.
In the space of a generation the Smurfits had gone from Wigan working class to international blue-bloods, drinking Chateau Petrus, playing poker with Frank Sinatra, gambling in the casino in Monte Carlo and jet-setting around the world's luxury resorts and great sporting occasions.
Old John Jefferson Smurfit, founder of the dynasty that could end with his sons and grandchildren being paid hundreds of millions of euro, arrived in Dublin from the North of England after the war with little money, no connections, but a work ethic and an expertise in manufacturing that was virtually unknown in this country.
His son Michael started on the shop-floor at their plant in Clonskeagh, Dublin and turned a moderately profitable packaging company into a global conglomorate. But old Jeff wasn't around to see that when his son took the helm he moved rather eccentrically to the Central Hotel in Macroom, Co Cork, where he lived out the rest of his life.
The children of old Jefferson Smurfit, Michael, Jefferson (Junior), Dermot and Alan took over the business and their lives and their lifestyles became a byword for a new Ireland of private jets, glittering parties and undreamt of wealth.
Michael and Norma were the golden couple, and the first of the icons of Irish business to publicly divorce. Then he had the much publicised relationship and child with Swedish beauty Brigitte and, much to everyone's surprise, they married. It didn't last, and then he moved on to a leggy Dutch beauty. He lives between Monaco and the K Club.
Norma has continued to live in their mansion in Stillorgan, south Dublin, and is known for her charity work and for helping out small Irish business ventures. She still holds 47,000 shares in the company, which makes her worth a modest ?150,000 in any takeover.
Michael and Norma's son Tony has risen to become a top executive in his father's company. He is married to the former model and actress Sharon Devlin; they have two children and stay out of the limelight. He stands to make ?413,000. Sharon Smurfit, with an address at Marlborough Road, Dublin, has 203,000 shares in her own name, valued at about ?700,000.
Jeff Junior was the fun-loving one who enjoyed drinking, smoking big cigars, playing golf and gambling. On a trip to the US with his Dublin pals he lost #100,000 playing poker with Frank Sinatra in Las Vegas and had to borrow #1,000 for his air fare home. He died at home in the Isle of Man, after giving up his Havana's.
His widow, Anne Smurfit, also enjoyed the high life and became embroiled in a celebrated court case when professional gambler Colette Doherty had her ejected from a Dallas-style thatched house in Dublin's upmarket suburb of Rathmichael. Later her live-in boyfriend, who she met in Scruffy Murphy's, claimed in court she told him he was "worth #1,000 a week". He was acquitted of defrauding her of #16,000.
The least known brother, Dr Alan Smurfit, has been the quiet one of the family, living outside Ireland for much of his life. He and his wife Claudine have one son, Peter. He has been deputy chairman of the company since 1984 and has held a number of senior positions in the company, as well as being chief executive officer of its Latin American operation. Dermot Smurfit split up with his wife Caroline after a turbulent marriage. She was also at the centre of a high-profile court case back in 1994 when her boyfriend, David Pearce, was bound to the peace after he was acquitted of assaulting her. However Caroline was granted an injunction restraining him from stalking her.
"When she got her settlement [from Dermot Smurfit] I was banned from the house," the Aldershot builder said later. Dermot Smurfit and Caroline have two children, Dermot Jnr and Vicky who has matured into Victoria, the actress now playing opposite Hugh Grant in About a Boy.
According to the company share register in Dublin, Victoria Smurfit does not have a shareholding in the company in her own name. Her father Dermot however is one of the main shareholders with over five million shares valued at more than ?22m. Victoria is far from your standard Irish 'It Girl' on a trust fund. She doesn't like to use the Smurfit name and is down to earth. She is very much her own woman, having struck out by herself in London when she was 20 after leaving drama school in Bristol in 1995. Victoria Smurfit has since made a name for herself far from the world of paper and packaging.
Now the time appears to have come to bring to a close the saga begun by a man from Wigan who knew how to work and had sons who knew how to make money.
