When Wall Street Landed
Clonakilty in Cork is best known for its black pudding but Wall Street behemoth JP Morgan was more interested in the enterprise based at the town’s West Cork Technology Park when it came calling in March 2022. Since 2005, Global Shares had developed a strong niche running share ownership plans for corporates and mid-size firms, building up a client base of c.650 employers and their 800,000 staff.
The deal closed in Q3, when the American bank disclosed that its two acquisitions in the period, Global Shares and Figg Inc, had involved $880m in goodwill payments. Press speculation had it that JP Morgan had paid $730m to acquire the lossmaking Cork venture. Whatever the number, it was very substantial, and like its customers Global Shares believed in spreading the equity around, with hundreds of the 600 staff complement owning shares.
The sale was a triumph for chief executive Tim Houstoun, who joined in 2008, and more so Richard Hayes (74), the veteran businessman who became involved in 2007 and previously ran IWP plc and IFG. Global Shares’ annual return data is incomplete but in recent years Hayes owned c.11% of the business. Other beneficiaries from the sale included Ron Bolger, Gerry Flood, Mark Purcell, Michele Connolly, Richard Whelan and Eoghan Quigley.
Tech investment in the platform totalled $29m since inception. The company had turnover of $42m in 2021 and booked a pre-tax loss of $5m. Accumulated losses were $28m, funded by equity investment capital of $27m, $4m in bank debt, and $25m loan funding from London lender Carrig Clen Investments.
Another big Munster deal was the January 2022 acquisition of Edpac by Sweden’s Munters Group for €29m. Established in 1999, Edpac makes precision cooling equipment and air handling systems for data centres and had turnover of €17m in 2021. Edpac’s principal shareholders were Noel Lynch
(42%), Michael Leahy (42%) and Ciaran Coughlan (15%).
Fremantle’s acquisition of a majority stake in Element Pictures in May 2022 was the largest AV deal of 2022. Ed Guiney (56) and Andrew Lowe (54) established Element in 2001, though they were involved in film in the previous decade. The producer of TV series such as Normal People and Conversations With Friends, Element is also responsible for the new Netflix film The Wonder.
The Sunday Times reported that Fremantle, a subsidiary of Bertelsmann, paid €55m for a 51% stake in Element, consisting of an upfront cash payment of €45m and €10m in contingent consideration. Element is owned equally by Guiney and Lowe, and Fremantle also has an option to buy the remaining shares in Element for €54m.
Obelisk in Cavan didn’t get to be as big as Sean Quinn’s many enterprises but the owners retained control for longer. Colm Murphy (53) and Padraig Brady (57) established Obelisk Communications in 1996, and in April 2022 they sold the business to Portuguese buyer Constructel Visabeira.
The Obelisk business is mostly design, build, upgrade and maintenance of telecoms infrastructure in the UK, Ireland and South Africa, and turnover in 2021 was €34m, with a pre-tax loss was €3.7m. December 2021 liabilities were €23m vs assets of €21m, indicating the risk appetite of the founders. Murphy and Brady each spoke for c.43% of the equity, with director Declan O’Neill owning c.14%.
Fifty per cent growth in turnover over four years to reach the €30m level is a sure way in to attract the attention of larger peers. That was the story at Acacia Facilities, which was acquired by larger German peer Apleona in October 2022. Acacia, established in 2009, was one of the two largest owner-managed integrated facility management providers in Ireland, with c.230 employees. Its FM spans maintenance, cleaning, porterage, catering, mailroom, security and landscaping services, as well as electrical, plumbing and boiler maintenance services.
Acacia’s four owners were David O’Brien (62), Tony Downes (56), Fergus MacMahon (51) and Clive Brazier (51), who founded the venture together and had equal shareholdings. When Acacia established a holding company in 2016, turnover that year was €20m. Annual sales increased to €31m in 2020,