AIB TO SELL OFF DISTRESSED MORTGAGES ON FAMILY HOMES - Majority State-owned AIB is preparing to offload thousands of distressed mortgages secured on family homes, a politically contentious step which the bank has avoided until now.
The lender has sold billions of euro in non-performing debt in recent years, but it has all been secured on second homes or business debt, writes the Irish Times. The loan sale, which has been code-named Project Birch, is being planned for early next year, likely before the end of spring. It is likely to reignite debate about the sale of non-performing loans to so-called vulture funds. Many of the borrowers earmarked for inclusion in Project Birch have paid little or nothing towards their debts for long periods of time. Meanwhile, the bank is under pressure from the European Central Bank to bring down its record level of non-performing loans. Debtor advocates and Opposition politicians have raised fears over the treatment of borrowers by overseas funds who have invested billions in Irish assets. Others point out that debtors are offered the same protections no matter who owns their loan, and argue that the fears around investment funds are overblown. Both Ulster Bank and Permanent TSB have sold owner-occupier loans to investment funds this year. AIB - which is 71% owned by the taxpayer - has targeted reducing its level of non-performing loans to about 5% by the end of the year, down from its current level of 7.5%.
***
BAKEHOUSE COOKS UP PLANS TO RAISE €10m IN FUNDING - East Coast Bakehouse, the biscuit maker established in 2015 by Michael Carey and his wife Alison Cowzer, could raise more than €10m in funding next year depending on how fast its business expands.
Speaking to the Irish Independent, Mr Carey said that the business, which is Ireland's only commercial-scale biscuit maker, remains profitable and that it is eyeing opportunities across its own brand as well as contract manufacturing. About €23m has been invested in the Co Louth-based business, including €7.5m in equity. Mr Carey and Ms Cowzer retain most of the equity in the business, but a few heavyweight backers also have small stakes. They include Donard Gaynor, a former executive with US drinks firm Beam; Patrick Joy, the founder of Co Louth-based Suretank; Laurence Shields, the founder of LK Shields solicitors; and Stephen Twaddell, the former president of Kellogg Europe. Enterprise Ireland has also invested in the business. "We're constantly looking at what the next phases are, but we're reviewing our options in terms of the next round of investment," said Mr Carey. "Subject to opportunities progressing, it's most likely in the first half of next year before we do anything," he added. "There's a whole range of sources of funding that could form part of that solution."
***
DAWN FARMS ACQUIRES ITS FIRST PRODUCTION FACILITY IN MAINLAND EUROPE -Dawn Farms has acquired its first production facility in mainland Europe.
The Kildare food production company supplies to chains such as McDonalds, Pizza Hut and Subway. It has bought Haas, a family owned pizza topping supplier which is based in Germany, says the Irish Examiner. CEO of Dawn Farms, Larry Murrin, says it is helping the company to ramp up its growth ambitions. "We've been serving Europe for 25 years from our Irish base and this Haas acquisition now gives us the opportunity to somewhat accelerate our growth in Europe on the basis that we will have localised an element of what we sell there," he said. "We already have a strong business and market position in the United Kingdom and notwithstanding the uncertainty relating to Brexit, the market for our customers' products will remain robust over the coming years," he added.
***
NIGHT SHIFT CUT DARKENS MOOD AT NISSAN - Fears over the future of Nissan's sprawling car plant in Sunderland have intensified after the Japanese carmaker said it was cutting its night shift.
Nissan is launching production at the factory of the next-generation Juke, a smaller sports utility vehicle, but there is speculation that anything other than a non-disruptive "soft" Brexit could lead it to cut output of its best-selling Qashqai, a larger version of the Juke. The Sunderland plant is the most productive car factory in the UK, at its height producing more than 500,000 cars a year and employing 7,000 workers, says The Times. However, its future has been under discussion since a collapse in profits at Nissan. That heralded the announcement of a 10% cut in global output.
