CurrentAccount:O'Flaherty Holdings, one of Ireland's oldest and most successful family companies, entered a new era this week with an agreement to sell back its exclusive Volkswagen distribution rights to the iconic German car-maker.
The deal, effective from October next year, will be worth tens of millions of euro to brothers Michael O'Flaherty (74) and Nigel (69), prime shareholders in the holding company and its Motor Distributors arm.
That the deal was in gestation for three years illustrates their affinity to the lucrative franchise acquired by their late father Stephen in 1950, when all things German still had the taint of war.
The question arises as to what the brothers will do with the proceeds of the transaction, which will provide a considerable addition to their already significant wealth.
O'Flaherty Holdings owns major property and aerial lift interests. With annual revenues approaching €1 billion and profits in excess of €53 million a year, the business had accumulated profits of €260 million by the start of last year.
What to do with the money? With high-end property valuations all but out of control, the group might seek to move into new areas.
O'Flaherty Holdings branched out last year with the acquisition of digital imaging firm C3. This implies a serious interest in diversification. But at a price of less than €20 million, the C3 deal left plenty in the tank for more.
That's not to mention the equally lucrative Mercedes franchise that has also been in the control of Motor Distributors for many years. Just as BMW bought back the distribution rights for that marque from Frank Keane, the Volkswagen deal appears to set a precedent.
So the O'Flahertys can bank on even more money coming in pretty soon.
The brothers' aversion to publicity has some renown. But the latest developments in their business and the anticipation of more action to come will only intensify interest in their next move. After 57 years in the Volkswagen fold, it's time for the next big thing.
Irish knights and commoners hit Davos
Bono will be doing what he does best (annoying people) when he graces the World Economic Forum session on "Delivering on the Promise of Africa" today. Trying to keep him in check will be Niall FitzGerald, the former Unilever boss and current chairman of Reuters.
Both men might care to ask their Swiss hosts why they are listed in the official website programme as being United Kingdom delegates. A simple error, no doubt. Or have the Swiss been confused by the fact that both men are knights of the realm (sort of)? The good news is that Tony Blair is on hand to explain how an Irish citizen can be knighted by the queen. Why they would want to be is another question!
Also at Davos - and currently still a commoner was the Taoiseach - who gave his by-now standard speech on the Irish economic miracle, but on this occasion singling out social partnership as perhaps the most significant factor contributing to the turnaround. This just goes to confirm the idea of Davos as a place where you can say things you would not dare to try to get away with at home.
NTR chief executive Jim Barry spoke in similar vein when he attended a seminar on climate change, the security of energy supply and resource depletion as a voice of the recycling-led waste management and alternative energy sector. Current Account suspects Jim glossed over the issue of the M50 toll-bridge gridlock and its impact on resource depletion. He probably did not dwell either on how tolling remains NTR's single biggest earner.
Davy feels optimistic
Davy's weekly market comment this week tells us that inflationary fears are, well, a bit inflated. In case you need reminding, December's consumer price index grew by 4.9 per cent year-on-year, way ahead of those prudent folks in the rest of the euro zone, who could only manage an average of 1.9 per cent.
But Davy says that inflation here is not as high as all that. Mortgages added 2.2 per cent, and they're not included in the European figures. Elsewhere, Davy says you can knock out the budget tax increase on fags - as well as energy - and that cuts inflation right down.
So that's it, excluding mortgages, energy and tobacco, inflation was just 2.2 per cent. But tell us, when you leave out mortgages, energy and tobacco, there's not a whole lot else left, is there?
