Today in the press

Friday 07 February 2014 09.26
A look at some of today's business stories in today's newspapers
A look at some of today's business stories in today's newspapers

NPRF FIRES STATE STREET AFTER UK OVERCHARGING SCANDAL - The National Pension Reserve Fund (NPRF) has terminated the mandate held by State Street Global Advisors (SSGA) to manage €650 million worth of equities for it, following a fine that was recently levied on State Street in Britain in the wake of an overcharging scandal involving its British unit. A spokesman for the NPRF confirmed last night that it axed SSGA on Monday, following a meeting that took place of the commission that oversees the NPRF. The Irish Times says that the move followed the publication last Friday of a report by the UK’s Financial Conduct Authority (FCA) into failings at State Street’s transition management business. The FCA fined State Street £22.9 million in relation to the overcharging of six clients, including the National Treasury Management Agency, for whom the NPRF manages assets. State Street had already paid back about €3.2 million to the NTMA following the discovery of overcharging going back to 2010. In a statement last Friday following the publication of the FCA’s decision to fine State Street, the NTMA noted: “The FCA is very critical of State Street UK and states that its transition management business deliberately overcharged six clients”, of which it was one.

***
DOCKLANDS AUTHORITY LOST OVER €180m ON SEVEN BOOMTIME PROPERTY DEALS - The soon-to-be-defunct Dublin Docklands Development Authority (DDDA) lost over €180m from seven property deals. New figures disclosed by an adviser to the authority, which is set to be wound down by the summer, reveal the full cost of a series of disastrous ventures. The Irish Independent says that figures were disclosed to the Dail's Public Accounts Committee by John Crawley, a financial consultant who has been working with the authority since 2010. The losses were described as "an absolute disgrace" and a terrible burden on the taxpayer by PAC vice-chairman Kieran O'Donnell of Fine Gael. Mr Crawley disclosed losses from a series of boomtime deals which turned sour after the property market crashed. He said that CHQ, a shopping centre in the IFSC, had been bought by the authority for €45m and sold for just €10m. A site on the North Lotts which was bought for €50m ended up with a value of just €7.8m. Other sites in the docklands which were bought using compulsory purchase orders were later transferred to NAMA at a fraction of their initial value.

***
CAIRN ENERGY DRILL PROGRAMME IN CLARE A STEP CLOSER - The exploratory drilling for oil and gas off the Co Clare coast has moved a step closer with the rig, the Blackford Dolphin, arriving in Belfast in recent days. Cairn Energy is leading the drill programme in the field that has an estimated recoverable resource of between 100 and 200m barrels of oil equivalent, says the Irish Examiner. Exploratory drilling of the resource is due to take place in the second quarter of this year. There are a number of companies involved in the drilling venture, with Cairn having a 38% shareholding, Providence 32%, Chrysaor 26%, and Sosina 4%. A discovery well was drilled at the Spanish Point site in 1981 and the partners are hoping that advances in technology will make the site commercially viable for oil and gas. The undeveloped Spanish Point gas condensate and Burren oil discoveries, and six adjacent licensing option blocks cover an acreage of 2,753 km2. 

***
SHAREHOLDER UNEASE OVER MICROSOFT RESHUFFLE - Some of Microsoft’s major shareholders are expressing unease over this week’s management reshuffle, in which founder Bill Gates moved from chairman to a new role as technology adviser, says the Financial Times. Investors broadly welcomed the choice of Satya Nadella, a 22-year veteran of the company, to become chief executive, but three of Microsoft’s top 20 shareholders voiced disappointment or concern about other aspects of the changes. These included the appointment of John Thompson, the former chief executive of Symantec, to replace Mr Gates as chairman, and a plan for Mr Gates to spend more time at the company “supporting Mr Nadella in shaping technology and product direction”. One large shareholder warned that Mr Gates could become an alternative centre of power, leaving employees and investors wondering, “who’s the boss?” “He did not do a good job of establishing his legacy, or spreading his secret sauce to the management team, and this is his second chance to do it,” the shareholder said. “It smacks of a one-man company, which is quite frightening for a company of this size.

Keywords: presswatch