Is Denis O’Brien Ireland’s Rupert Murdoch?

April 20, 2012

The Irish entrepreneur and billionaire Denis O’Brien has a business career with similarities to that of Rupert Murdoch. He is currently believed to have been involved in moves to control Ireland’s Independent News & Media organization

I was struck by the account in this week’s Irish Times [April 20th 2012] of the boardroom changes in Ireland’s Independent News & Media organization [INM]. The story was presented as a clash between INN’s owners within a business empire founded by Tony O’ Reilly, and the business interests of the next-generation Irish entrepreneur Denis O’Brien who has become a major shareholder at INN.

With speculation mounting that dissident shareholder Denis O’Brien was planning to topple him, Independent News & Media’s chief executive Gavin O’Reilly raised the white flag and trudged off the battlefield.

O’Reilly was a marked man from the moment Leslie Buckley, O’Brien’s closest business associate, was dumped from the INM board last year.
The fact that INM’s operational performance has worsened over the past year also played a role in O’Reilly’s demise. No dividend has been paid since the crash. It was once considered the safest [investment] in town. Nothing O’Reilly said or did was able to arrest the slide. It is interesting to note that since its AGM last June, chairman Brian Hillery and the chief executive [Gavin O’Reilly ] have now both left.

O’Reilly’s exit means that for the first time since 1973 no member of Anthony O’Reilly’s family will be controlling INM’s affairs. What all of this means in relation to O’Brien’s plans for his INM stake remains to be seen. Many close to INM believe he has no intention of moving to acquire the company. There are substantial issues around his media ownership here, given his interests in six radio licences. Last night, Taoiseach Enda Kenny said the [Irish] Government would “have a reflection on this in terms of cross-ownership of media”.

He may have gotten rid of O’Reilly but O’Brien has failed to gain control of the company, which many commentators presumed was his plan. Then again, perhaps that is the way he wants it. For now, at least.

Denis and Rupert

The career and leadership style of Denis O’Brien has some similarities with that of Rupert Murdoch. However, such comparisons risk over-simplifying complex issues, and need to be taken with a conceptual health warning.

Mr O’ Brien became a Portuguese resident thus avoiding paying taxes in Ireland.

A Government investigation [The Moriarty tribunal] examined his actions in the move which gave him his greatest financial boost. According to The Irish Times [3rd March, 2011] it found “beyond doubt” that [the then minister for transport, energy and communications] Mr Lowry gave “substantive information to Denis O’Brien, of significant value and assistance to him in securing the [mobile] licence”.

Update [Dec 11th 2012]

This week the IMM group’s financial position was assessed as week, and the company in need of drastic restructuring.