Denis the menace

Denis O'Brien is assembling a vast war chest with which he may do battle in Ireland with Tony O'Reilly and Michael O'Leary. By Martin FitzPatrick


Mobile telephony may have turned Denis O'Brien into Ireland's greatest entrepreneur.

He has zoomed into the billionaire category faster than any rival. He has done so in the face of envy, resentment and active opposition and he is now the biggest name in mobile telephones south of the Florida Keys. Furthermore, his operation continues to grow like Topsy.


He now has more than four million customers in more than 22 markets. The O'Brien footprint is right throughout the Caribbean, Central America and latterly, the Pacific. And all this was achieved from a standing start in 2000.


Of course he sailed into the blue waters of the Caribbean with pockets bulging with the €318m in cash that he got after selling Esat Digifone to British Telecom. But his success in sweeping through the region faster than the Conquistadores has been swifter than anyone had thought possible. Most surprised was the British multinational Cable & Wireless, who thought it had the region sewn up and who appears to be having its lunch comprehensively stolen.


Denis O'Brien has a talent for sparking events just because he happens to be around. The Irish cricket team, which surprisingly made the knockout stages of the Cricket World Cup, is the latest unlikely source for the spreading of the O'Brien legend. Having beaten Pakistan and turned an expected two-week stroll in the Caribbean sun into a five-week marathon, the Irish team was short of cash. While the Bank of Ireland stepped in with cash and its name on the players' shirts, O'Brien is believed to have produced the equivalent of €130,000 to tide over the players. He could not demand a shirt sponsorship even if he wanted it because his company, Digicel, already sponsors the host team, the West Indies.


On the goodwill side of his balance sheet, that will go alongside his chairmanship of the 2003 Special Olympics as a contribution to the O'Brien myth-making.


But for all his good work and dig-outs to worthy causes, there are still many people who somehow resent the O'Brien style, some of whom have ended up pocketing large sums inside or outside the courts because of their relationships with Denis. The former accountant to rock stars and current chairman of the Sports Council, Ossie Kilkenny, who was involved with O'Brien in the Digicel Caribbean set-up at the start, fell out with him in a case which almost came to court. An out-of-court settlement of approximately €24m is understood to have satisfied that particular argument. But it's been one of many down the years.


The legacy of the award of the original Esat Digifone licence by the then industry minister, Michael Lowry, still captures tribunal headlines and still rankles. An effort to buy the Doncaster Rovers ground in the North of England also hangs around the tribunal corridors to complicate the image of O'Brien the businessman, as well as his works and pomps.


Another bit of anti-O'Brien prejudice is associated with his tax-exile status. He is credited with saving €50m-plus in capital taxes by decamping to Portugal immediately after the Esat payday. Last year, he took up residence in Malta, leaving the “usually well-informed tax-planning sources” to speculate that the Portugese equivalent of the Revenue Commissioners had something planned for the Digicel fortune that O'Brien was accumulating in the Caribbean. (This supports another part of the O'Brien legend – that he is often ahead of the game.)


Of course Denis O'Brien does not just confine himself to sweeping through the Americas like “Brave Cortes”. He still has an European and Irish dimension to his business. He actively manages Communicorp with its Irish and European radio stations including NewsTalk 106, which is now a national service and may well be a money-spinner given time.


He also likes surprises. In two separate deals, he has snatched a five per cent or so share of Tony O'Reilly's Independent News and Media Group. Quite why he is doing this has everyone scratching their heads. It is undoubtedly a rewarding investment in dividend terms, but will O'Brien be always happy to be perched outside the O'Reilly window peeking in? Many observers think not.


His decision to stick his nose in the Ryanair bid for Aer Lingus – giving a rather clear two-fingered salute to Michael O'Leary – was another remarkable and not easily explained decision. What it does suggest is that, tax exile or not, what happens in Ireland is still pretty important to O'Brien, and those who ponder his Indo stake should perhaps bear that in mind.


However, the prime speculation about Denis is whether, having built his giant mobile-phone business in the Americas and beyond, he is prepared to continue to grow it or cash in. Despite occasional speculation that the scale of the business makes it an attractive purchase, there are no obvious signs that he is prepared to loosen his grip. A hugely successful funding in New York earlier this year suggests that Digicel will conquer more territories before it goes on any auction block. But when it happens, Denis O'Brien will be a powerful figure.