Morning business news - August 22Friday 22 August 2014 10.48
At a time when companies across Europe are being hit by sanctions imposed by the Russian government, one company has managed to pull off something of a coup. George Mullan and his SIS Group have just signed a second contract to provide a stadium pitch for the 2018 World Cup at Spartak Moscow.
George, who is a finalist in this year's EY Entrepreneur of the Year Award, explained that SIS in one of a few companies that builds sports pitches - both natural grass and synthetic turf - all over the world. He says that the company started in Holland 15 years ago but it currently has offices in Dubai, Istanbul, Moscow and Amsterdam. The company naturally seeds some pitches but also grows grass remotely which is then transported into the stadium. "The biggest challenge is growing a pitch in place. Stadiums are designed to be architecturally stunning but growing grass is difficult so we use artificial lights and that allows us to recreate the natural light effect," he explained.
George Mullan said he was not hugely surprised that he had been contracted to build a second pitch in Moscow given the strained relations between Russia and the West right now. "Sports surfaces is a specific and narrow market. We haven't had any issues but we are cognisant that it could be an issue down the road. World Cup 2018 is one of President Putin's key projects and it's one of the last things that will be touched," he believes.
Mr Mullan said Russia and Qatar would be the group's key markets in the coming years with both countries due to host upcoming World Cup tournaments. He said the first prototype training centre will come up for tender in Qatar this year and the group have finished two stadiums in Saudi Arabia. As for doubts about the tournament going ahead in Qatar, George Mullan said they would "wait and see".
MORNING BRIEFS - Hibernia REIT has exchanged contracts to buy The Forum building in Dublin's Financial Service Centre for €37.8m. The building on Commons Street comprises over 47,000 square feet of office space as well as 370 car parking spaces. The offices are occupied by Depfa bank. Today's deal is Hibernia's 10th acquisition since listing.
*** Argentina's plan to swap defaulted bonds with new ones issued in local currency has been ruled illegal. Buenos Aires defaulted in July after US judge Thomas Griesa ruled that so-called holdout investors were entitled to their full bond redemption. Argentina had already agreed to pay back the majority of its bondholders a reduced return for their holdings but they could not pay anyone until everyone had agreed, so they ended up defaulting. The country has been trying to come up with solutions ever since - this latest one has been ruled illegal, but Judge Griesa did not find Argentina in contempt of court.
*** Just a day after regulators in Russia closed down four McDonalds outlets in Moscow for alleged hygiene breaches, it looks like they are casting their net wider. The food safety agency is to conduct more checks on restaurants in the Urals following food safety complaints. The closures came amid rising tensions between Russia and the West over the crisis in the Ukraine. A few weeks ago, Russia imposed embargoes on food imports from the EU, US and some other Western countries, in response to sanctions over Ukraine.
*** One person not put off by Bank of America's record fine for its role in selling toxic mortgage securities is billionaire Warren Buffet. He has predicted that the bank will now return to soaring profits after its litigation has been put behind it. The bank yesterday agreed to a record $16.7 billion fine to end US probes into the bank's role in the affair. Since 2010, the bank has agreed to more than $70 billion in deals to resolve claims from the housing bust.
*** US markets are back up at record highs again after a host of positive economic indicators on home sales and factory activity in the UK. Asian markets followed suit overnight. Investors appear satisfied that the US Federal Reserve is not about to take any radical steps on raising interest rates. They'll be keenly watching Wyoming this weekend and any hints of future action from Fed Chair Janet Yellen. She will address the annual Jackson Hole summit of central bankers. ECB chief Mario Draghi will also address this year's event.