Irish Power Systems (IPS), an energy company set up in 1995 to use landfill gas for the production of electricity, has been sold for €38 million.
Two Dublin businessmen who were involved in the establishment of IPS each had a 22.5 per cent stake. Two other men had 2.5 per cent stakes while the ESB held 50 per cent.
The company has been bought by Bioverda, the bioenergy division of NTR plc.
Businessmen Michael Devaney and Patrick Keane each held 22.5 per cent stakes in IPS, while Philip Kelly and Patrick Kennedy each held 2.5 per cent stakes.
Mr Devaney and Mr Keane are both now retired. They spotted an opening for an electricity from landfill gas business, and set up IPS in partnership with UK company Whimpy. Whimpy later sold out to the ESB.
The latest filed accounts for IPS, for the year to end-2004, show the company made a pre-tax profit of €2.1 million, on a turnover of €6.28 million. The pre-tax profit in 2003 was €1.1 million.
During 2004 the company paid out dividends of €720,000. It employs 16 people.
At the end of 2004 the company owed AIB €5.25 million, according to the accounts.
"The acquisition of Irish Power Systems has come at an ideal time for Bioverda as we develop our bioenergy business," said John Mullins, chief executive to Bioverda.
"The conversion of methane sourced at landfill to electricity is a very efficient means of providing much-needed green energy to the Irish market."
Mr Mullins was speaking from Thuringen, Germany, where he announced a €37 million investment in a new biodiesel facility.
Mr Mullins was critical of the lack of integrated thinking at Government level in relation to the creation of biofuel production in Ireland. He said what was needed was an integrated strategy involving the departments of Agriculture, Energy, Finance and Environment.
"What is needed is clear direction from Government," he said. "It's just not going to happen if its left to the market." Bioverda would not be investing heavily in the sector in Ireland without a clear strategy at Government level.
Mr Mullins said that despite the potential for producing biodiesel from home-grown rapeseed, and ethanol from home-grown beet, he believed it was more likely that Ireland would end up importing biofuel rather than producing it.
Bioverda's German announcement is the second there. It had already announced it is developing a similar facility in Neubrandenburg.
Mr Mullins said Germany was the most mature biodiesel market in Europe. Bioverda will work with farmers' co-ops to convert rapeseed into biodiesel, rape cake and pharmaceutical grade glycerine.
On the purchase of IPS, Mr Mullins said Bioverda was now looking to grow the business. He said that overall, Bioverda planned to have approximately 200 employees within three years. It plans to have 90 German employees by the end of this year and is looking for opportunities in Central Europe and North America.
