Ryanair shares still expensive despite rapid descent 4 Nov 2013 Europe’s largest low-cost airline has spooked investors with a second profit warning in two months. Ryanair has strengths, but confidence is leeching fast. Stability may return most quickly if the company prunes its growth ambitions and focuses more on sustaining profit.
Ryanair should reflect on why it is getting flak 16 Aug 2013 The airline complies with all safety regulations and has a good record. Yet its safety culture is in focus following a pilots’ survey that Ryanair disputes. The saga is a culmination of needlessly toxic labour relations that bring little obvious benefit to the group.
Periphery can aspire to Irish-style stagnation 6 Aug 2013 Ireland has long been stuck with an in-and-out mild recession. Tentative green shoots are now sprouting, but Dublin’s dependence on external demand will keep the recovery slow and bumpy. Still, such relative stability is a fair aspiration for the rest of the euro zone periphery.
Elan acquisition contains possible side effect 29 Jul 2013 Over-the-counter drugmaker Perrigo isn’t a natural buyer for the Irish biotech. Elan is largely a shell company with cash and royalty rights to a blockbuster treatment. Tax savings dominate the logic of the $8.6 bln deal. Relying on a practice under growing scrutiny is risky.
Anglo Irish tapes will make EU largesse harder 25 Jun 2013 Dublin may have been misled by the bankers that caused its biggest financial disaster. That would be a blessing in disguise if it forced a much-needed public inquiry. But It will also strengthen the euro zone’s reluctance to use its funds to cut Ireland’s bank bailout costs.
Apple tax fight needs global response 21 May 2013 The tech giant followed the law, but its aggressive use of Irish subsidiaries to reduce tax payments fails the smell test. Ireland comes off as an unscrupulous tax haven, while the U.S. government looked the other way. It’s time for a new international deal on corporate taxes.
Euro zone daren’t flunk Lisbon’s solidarity test 12 Apr 2013 After taking a chainsaw to the Cypriot economy, euro zone officials must decide whether to give Ireland and Portugal more time to repay their bailout loans. An extension won’t cost much or save either country, and may be inevitable. Playing hardball would be self-defeating.
Ireland shows powers of virtual ECB 14 Mar 2013 Dublin has sold the first 10-year bonds since its bailout. The move helps it qualify for controversial ECB bond buying - and shows it doesn’t need it. Mario Draghi’s virtual intervention is working wonders. The euro crisis goes on.
Ireland, Portugal prey to European electoral cycle 7 Mar 2013 Europe’s poster children for austerity will get symbolic relief from the extension of their bailout loans. This is a timid response to the Italian shock. Euro members want to show that fiscal discipline pays, but with elections looming, Germany can’t agree on a bolder package.
$6.6 bln won’t be enough to end Elan’s rash dreams 25 Feb 2013 The biotech has grand M&A plans after selling rights to a blockbuster drug for $3.25 bln. Royalty Pharma’s indicative offer is based on the notion that it will invest more wisely than Elan’s current bosses. It’s a credible premise, but a 4 percent premium won’t seal the deal.
ECB delivers long-overdue Irish relief 7 Feb 2013 The European Central Bank has given the nod to the restructuring of Ireland’s bank bailout, which will make the country’s debt more bearable. Euro zone leaders had resisted allowing their bailout fund to take on the burden. Luckily the ECB is stepping in when governments fail.
Buoyant markets give ECB upper hand in Irish spat 28 Jan 2013 The European Central Bank has rejected a plan by Dublin to restructure its bank bailout. Any deal needs to balance the risks of derailing Ireland’s recovery against a breach of its own rules by the ECB. For now, low Irish bond yields give Frankfurt an advantage.
Bailout babies could give ECB target practice 22 Jan 2013 Ireland and Portugal are slowly regaining market access and may soon be able to ask the ECB to buy their debt. The bank would then have to put its money where its mouth is. But it could use the opportunity to show the benefits of its still-untested programme at a limited cost.
Governments on right side of credit cycle for once 17 Jan 2013 Investors are lapping up contingent capital securities in bailed-out banks. Dublin sold on a CoCo from its bank rescue. Belgium’s KBC is issuing the bonds to recapitalise. The boom is helping Ireland and Belgium recoup bailout costs. They should take the money while they can.
M&A machines can’t live off debt forever 14 Jan 2013 Privately held Ardagh has grown sevenfold since 2007 through deals bankrolled by high-yield investors. Now the Irish packager is buying a Saint-Gobain unit for $1.7 bln. Debt-funded M&A sprees needn’t end in tears. But Ardagh will one day need the support of equity investors too.
Dublin-style tax cut for Belfast carries big risks 9 Jan 2013 Sectarian unrest and a bloated public sector may seem unrelated. But Northern Ireland’s heavy subsidy from London means greater pain under austerity. Cutting corporate tax rates, a la Dublin, could be a game-changer. But fiscal radicalism could also bring nasty side effects.
Ireland gets welcome back-up from IMF 20 Dec 2012 The IMF is urging the euro zone to help Dublin restructure its bank bailout, and warns there are limits to austerity. The Fund is moving to a more pro-active role as bailout partner. With markets slumbering and the crisis abating, Ireland needs all the help it can get.
Are Dublin and Lisbon ready for Greek bondage? 29 Nov 2012 Ireland and Portugal wouldn’t mind benefiting from the type of debt relief that Greece just received. But if Athens got sweet terms, it surrendered part of its fiscal sovereignty in return. Other countries are only half-serious when they call for equal treatment.
Can Barclays old boys make the Irish play pay? 24 Oct 2012 Barclays alumni made millions helping their ex-employer offload subprime assets in 2009. Now they have taken a 17 pct stake in Ireland’s 74 bln euro bad bank. The terms aren’t public. But the arrangement seems to need leverage, or a discount, or both if history is to be repeated with this new punt.
Ireland gives euro zone a hint of crisis freedom 26 Jul 2012 Dublin is issuing long-term debt for the first time since the rescue of 2010. The funding is likely to be pricey. But if the deal gets sold, it will show that bailouts needn’t be forever, or end in default. With Spain and Italy on the brink, euro zone partners will be thankful.