Today in the pressMonday 04 February 2013 09.18
GOVERNMENT NEEDS TO ENCOURAGE FIRMS TO GO PUBLIC, SAYS STOCK EXCHANGE CHIEF - Irish Stock Exchange chief executive Deirdre Somers has said the Government needs to consider ways of incentivising young companies here to go public, rather than selling out to trade players, as they seek to scale up their businesses. Ms Somers also told The Irish Times the Government should consider listing State assets on the stock market rather than selling them via auctions or trade sales. Ms Somers said changes to our tax code and a stated Government policy to support the scaling of Irish enterprise were urgently needed to produce the next generation of Irish listed companies to take up the torch from the likes of Kerry Group, Paddy Power and Ryanair. She called for the Government to establish a “dedicated group to address the IPO [initial public offering] challenge” as part of its action plan for jobs. Ms Somers said an IPO task force was established in the US to find ways to stimulate activity and its findings were implemented by President Barack Obama in the recent jobs act. Ms Somers cited the tax treatment of share options as one area that needs to be reviewed: “Why is it that our tax policy incentivises entrepreneurs to exit their businesses before global scale can be achieved? Is there any reason why we should not be saying that Ireland will have five new companies with a market capitalisation of over €1 billion in the next five years? Why is it that our tax policy does not reward risk and instead incentivises entrepreneurs to exit their businesses before global scale can be achieved?”
ESB'S PENSION DEFICIT SLASHED BY €1.89 BILLION IN JUST FOUR YEARS - The ESB managed to slash its pension deficit by about €1.89 billion in just four years. The Irish Independent says that the commercial semi-state had a €1.96 billion black hole in its contributory scheme in 2008, but that was reduced to €72m by the end of 2011. Given the sheer scale of the deficit, the company has been trying to plug the hole in recent years by closing it to new members and freezing pay and benefits. The contributory scheme was similar to a public service pension and was funded from contributions from members and the company. Management at the semi-state and unions have struck a deal where deductions were reduced with the roll-out of Career Average Revalued Earnings (CARE) from January last year, a pension and pay freeze until 2014 and 2012 respectively and the capping of any future increases in pensions at 4%. All future increases in pensions paid will also be dependent on the solvency of the ESB scheme. The Pensions Board approved a funding proposal in October, submitted by the trustees of the ESB scheme, changing the scheme from a defined benefit to a defined contribution. "The change in accounting treatment gave rise to a once-off exceptional charge in the financial year ended December 31, 2010, of €330m," the investor document said.
POWERLESS SUPER BOWL DISRUPTS ADVERTISERS - The Baltimore Ravens held off a resurgent San Francisco 49ers and survived a power outage to win American football’s most lucrative game, the 2013 Super Bowl. The Financial Time reports that advertisers paid up to $4m to appear in 30-second spots between plays but many of them had an eye to the digital world too, with about half of the ads using Twitter’s “hashtags” to stimulate online discussion after their broadcast. Beyoncé shook off allegations that she mimed her performance at the US presidential inauguration with an all-singing, all-dancing half-time show that also reunited her former group, Destiny’s Child, and was sponsored by Pepsi. CBS, which broadcast the game, remained on the air despite the half-hour power failure in the third quarter, which plunged the New Orleans Mercedes-Benz Superdome into darkness. The broadcaster did not cash in by running extra ads during the interruption, telling Advertising Age that its commitments to advertisers were “being honoured” despite what the industry magazine called “one of the oddest moments in Super Bowl history”. However, the blackout interrupted the plans of some marketers, including Coca-Cola’s two-part desert race ads, and altered the momentum of the game.
10 LONDON BOROUGHS WORTH MORE THAN ALL THE HOMES IN WALES, SCOTLAND AND NORTHERN IRELAND - It is not so much a divide as a gaping chasm - the growing disparity between house prices in London and the South-east and those in the rest of the United Kingdom was revealed today, prompting fresh concern among first-time buyers and fears for the national economic recovery. The London Independent says research shows that the net value of properties in just 10 London boroughs - Westminster, Kensington & Chelsea, Wandsworth, Barnet, Camden, Richmond, Ealing, Bromley, Hammersmith & Fulham and Lambeth - now outstrips the worth of all the properties in Wales, Northern Ireland and Scotland combined. Elmbridge, a leafy corner of the Surrey stockbroker belt bordered by the Thames and the M25, which is home to just 131,000 people, is now worth £31 billion - more than Scotland’s biggest city, Glasgow, where a population of 1.75 million inhabits homes valued at £29 billion. Property in the Royal Boroughs of Windsor and Maidenhead outstrips that in the whole of Cardiff. But it is in London that the extraordinary gulf is most starkly illustrated, according to the research by the property group Savills as part of its latest Valuing Britain analysis of the UK market. The capital’s richest borough, Westminster, with 121,600 dwellings, is worth £95 billion - more than twice the value of Edinburgh (pop 500,000) and three times that of England’s sixth most populous city, Bristol.