Today in the pressFriday 20 June 2014 11.24
McKILLEN AND RONAN TEAM UP WITH AMERICAN AND UK FUNDS TO RE-ENTER OFFICE CONSTRUCTION - Property developers Paddy McKillen and Johnny Ronan have teamed up to re-enter Dublin’s office construction market backed by a multibillion American investment fund and a British plc, says the Irish Times. The two men and their investment backers closed the acquisition of a strategic site beside the former Burlington Hotel in Dublin 4 for €40.5 million yesterday. Mr Ronan and Mr McKillen had originally planned to bid separately for the site with different backers. They later decided to jointly submit a successful bid for the site that has planning for a high-spec office block. The two developers have worked together in the past. They developed and jointly own Treasury Buildings which houses the National Asset Management Agency (Nama) and the National Treasury Management Agency among other projects. Colony Capital, a $20 billion investment fund, and Mr McKillen own about 60% of the joint venture. California-based Colony, which previously supported Mr McKillen in paying off his borrowings of hundreds of millions of euro from Anglo Irish Bank at par, is providing most of the finance. It is in a preferential position when a new office block is built and begins to generate revenue. Mr Ronan and Development Securities, a British plc, are minority shareholders. Dev Sec is separately backing Mr Ronan in talks with Nama about exiting the agency by selling his assets or refinancing them.
COMPANY DIRECTORS DIVIDED ON €2 BILLION BUDGET ADJUSTMENT - Irish company directors are almost evenly split over whether or not the Government should go ahead with a full €2 billion adjustment in the October Budget, says the Irish Independent. Up to now, much of the opposition to tough Budgets has come from charities and not-for -profit organisations (NGOs) and the political left. But influential industry lobby, the Institute of Directors in Ireland (IoD), said that Budget 2015 marked "a turning point in terms of the level of tolerance for austerity among directors in Ireland". Research conducted with members of the institute found that a clear majority (61%) regarded previous austerity Budgets a "necessary response to address Ireland's economic difficulties". But the IoD found its members were almost evenly divided on the idea that €2 billion should be taken out of the Budget through tax rises and spending cuts. "With regard to the level of austerity still needed, 48% (are) of the view that an adjustment of €2 billion should be maintained in Budget 2015, while 44% of those surveyed are calling for a smaller adjustment," the IoD said in a statement to launch its pre-Budget submission. Directors called for what they called the pillars of Irish life - education, healthcare and employment - to be protected. The lack of housing supply was also raised as a concern.
OFCOM CONTROL THREATEN BT'S POWER TO BUY PREMIER LEAGUE FOOTBALL RIGHTS - BT's ability to spend heavily at the forthcoming Premier League auction is under threat after the UK's Ofcom proposed restrictions on its wholesale broadband profits, writes today's Guardian. Sports rights have become key in BT's drive to win broadband customers against competition from TalkTalk and BSkyB, with the company offering free subscriptions to sports channels when selling superfast internet connections. But the watchdog has raised the prospect of tighter controls over the wholesale prices BT charges competitors for piggy-backing on its broadband network. "This is a watershed," said telecoms expert James Barford at Enders Analysis. "It discourages BT from spending a lot more money in any future auction, including the Premier League. From Sky's perspective this is excellent news. Talktalk is very pleased because it gives some comfort that BT will stay honest." The watchdog says that from next year it will police the margin between the wholesale price of BT fibre optic lines and the retail prices it charges customers.
GOLDMAN SACHS TRADER IN ROW OVER $13m BONUS - A former Goldman Sachs trader has filed an arbitration complaint against the Wall Street giant because his multi-million bonus wasn't big enough, reports today's London Independent. Deeb Salem, a Princeton graduate and former mortgage trader at the bank, claims his massive $8.25m bonus for 2010 does not reflect his performance and is seeking an additional $5m in compensation. Adding to his chagrin, Mr Salem, who told his mother he would receive at least $13m for the year, argues he was unfairly punished for a series of comments he made in the run-up to the financial crisis that caused the firm "reputational harm". According to the arbitration filing, the trader argues Harvey Schwartz, co-head of Goldman’s securities division at the time, told him: "We’ve all put things in writing that we should not have. Yours just got unlucky. We’ll make it up to you".