RYANAIR HAS 'NO INTEREST' IN EVER FLYING TO THE US - BONDERMAN - Ryanair won't ever fly transatlantic services, the airline's billionaire chairman David Bonderman insisted yesterday.
"We have no interest in flying transatlantic," he told shareholders at the airline's annual general meeting at Dublin Airport yesterday writes the Irish Independent. Ryanair also announced that it intends to return €398m in proceeds from the sale of its near-30% stake in Aer Lingus to shareholders before the end of the calendar year. It sold the Aer Lingus shares to IAG, which has acquired the former State-owned carrier. Mr Bonderman's seemingly definitive comment comes despite chief executive Michael O'Leary saying that a low-cost transatlantic service would be a medium-term aim for the company. Mr Bonderman is the co-founder of US private equity giant TPG, formerly Texas Pacific Group. He and TPG backed Ryanair in 1996, the year before it floated on the stock exchange. Mr O'Leary has always stressed that a transatlantic service would be a separate business to Ryanair, unlikely to even use the Ryanair brand. He has also said that launching it would be dependent on securing long-haul aircraft at cheap prices - something that's impossible right now due to bulging order books at both Airbus and Boeing.
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DIGICEL PREPARED FOR $400M ACQUISITIONS SPREE - Directors of Digicel have told investors it is prepared to spend $400m on up to 15 acquisitions as the group pivots away from being a pure mobile operator and expands into cable television, high-speed fibre and corporate services. Denis O'Brien, the company's chairman, Colm Delves, its chief executive, and chief financial officer Laurence Hickey outlined the acquisition plan in recent days in a presentation recorded for potential investors. The recording was made as part of a roadshow in the lead- up to Digicel's flotation, which it hopes will raise in the region of $1.7 billion, valuing the Caribbean-based telco at about $10 billion, including debt, says the Irish Times. October 7th was suggested as a possible date for the flotation. About $1.3 billion of the cash raised will be used to fund debt paydown, while the directors said the bulk of the rest would be used to fund buyouts. Mr O'Brien, whose 60% post-flotation stake will be worth close to $3 billion, will not take a dividend from the flotation, but his Island Capital corporate finance business could yield up to $20m arising from the transaction. The flotation documents reveal Island, an advisor to Digicel, is due a 0.5% fee of the gross flotation proceeds, which would be $10m if it hits the upper end of its price range and raises $2 billion.
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INSURANCE BROKERS ATTACK 'UNACCEPTABLE' LEVIES - Chief executives of the two bodies representing 90% of the country's insurance brokers have said plans by the Central Bank to hike levies on intermediaries by 45% are "unacceptable". Irish Brokers Association CEO Ciaran Phelan and head of the Professional Irish Brokers Association Diarmuid Kelly have told the Minister for Finance Michael Noonan that members are already struggling after incurring significant increases in Central Bank levies in recent years. As part of its proposed 2015 increase, the Central Bank is proposing to increase levies from €515 to €750. Levies in 2011 were pitched at €145, says the Irish Examiner. The two organisations say that, if the plan goes ahead, levies will have soared 515% since 2011. They say that they have been told that funding of the Central Bank's pension scheme, which amounts to a cost of €29m, is contributing to the increases in the levies. In their joint letter, the bodies have asked Mr Noonan to explore alternative options for funding the pension cost "rather than passing this cost to the industry who are already struggling to survive".
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CHINA'S SLOWDOWN HITTING UK FINANCIAL SERVICES, CBI WARNS - China's economic slowdown, global stock market turmoil and the oil price slump have hit financial services companies in the UK and dented growth prospects for banks, the CBI employers' organisation has warned. Growth in business volumes across financial services companies rose at the slowest pace in two years in the three months to September, following a two-year period of robust expansion, according to a survey by the CBI and the accountancy firm PwC. The slowdown comes after the Chinese stock market crashed in August, falling as much as 8.5% on "Black Monday", fuelling the subsequent slide in global stock markets, says the Financial Times. Some 21% of financial services companies surveyed said business volumes declined in the quarter, while 25% noted an increase. Rain Newton-Smith, director of economics at the CBI, said the stock market volatility has left a "clear mark" on the financial services sector, with impact on business volumes and investment plans. Growth prospects for UK banks, in particular, remain challenging, with interest rates expected to remain on hold, said Kevin Burrowes of PwC. He said business confidence among banks flatlined in the quarter, leaving the sector "cautious" over its short-term outlook. The emergence of financial technology - fintech - is posing a significant threat to traditional financial services companies.
