IRELAND COULD BE CLOUD COMPUTING CENTRE OF EXCELLENCE - MICROSOFT'S RELLIS - Today Microsoft celebrates 25 years in Ireland. The firm has 1,200 staff here. Over those years the company has had to move with the times, and much like Ireland, reinvent itself. It used to pack boxes with Microsoft software products, now it has moved on to data centres, research and development and cloud computing.
Paul Rellis, Microsoft's managing director in Ireland, says the world is facing a very challenging period right now as new economics becoming challengers to economies like Ireland - and not just on a cost point of view but also from an innovation point of view. He says the 'smart economy strategy' from the Government has become paramount for this country. He says it is not just a question of willing us to become an innovation economy, we actually must become an innovation economy to compete.
Mr Rellis says it is key to reset investors' minds and attitudes around the type of innovation we do in this country. Pointing out that there are great pockets of innovation in Ireland, he says the country will succeed in competing, but adds that this must be really accelerated and energised with a big investment programme.
On the innovation task force report, Mr Rellis says it is a great first step, but adds that now is the time to get energy behind it and get things going and actually investing in basic services like much improved broadband. He says a good example of how the country can compete is through cloud-computing, and adds that the report should have focused more on this issue.
The Microsoft boss says he believes cloud computing will be like what electricity was to the world 100 years ago. He says that 100 years ago companies and people had their own steam engines and produced their own electricity and then great utility companies came along and provided electricity at low cost with great availability. He says that is exactly what is happening with computing. From an IT point of view, he says there is a major inflection point where people are starting to see this move to cloud computing as a reality.
Mr Rellis says there is a great opportunity to have Ireland set up a cloud computing centre of excellence. He says that students in second and third level can be educated in computer application development and web application development so that the country can become a leader in this field.
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BANK OF IRELAND TO RAISE €3.4 BILLION OF CAPITAL - Bank of Ireland has this morning announced a €3.4 billion capital raising programme. This includes converting Government-owned preference shares into ordinary shares, buying warrants held by the Government, a private placement of shares and a rights issue. The good news for the taxpayer is that the buying of the warrants held by the Government is expected to net about €450m for the State. All of this has to be approved by shareholders at an extraordinary meeting next month. If approved it will see the state's actual holding in the bank grow to 36%. Today's plan also includes a private placement of shares worth €500m and a rights issue that would raise about €1.8 billion. The rest of the package will be made up of the conversion of preference shares to ordinary shares.
Kevin McConnell, at Bloxham Stockbrokers, says the very complicated move seems to be structured to make sure that it is well supported from both an institutional prospective as well as the bank's shareholders. He says the market will react fairly well to this morning's announcement, as the terms of the placing and the conversion of the Government's preference shares, both seem to be at prices which are relatively favourable for the next part of the transaction.
