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Denis O’Brien on track to make over €100m profit in sale of Beacon Hospital

Deal marks further shrinking of businessman’s empire as Australian financial services giant Macquarie to pay €400m for facility

Denis O’Brien Digicel

Last month, Denis O'Brien saw his stake in Digicel fall to 10 per cent as a group of bondholders took control under a €1.57 billion debt-for-equity-swap. Illustration: Paul Scott/Irish Times Graphics

Joe Brennan
Tue Feb 13 2024 - 16:22

Businessman Denis O’Brien is estimated to be on track to make more than a €100 million profit before tax from the sale of his majority stake in the Beacon Hospital, with the deal coming weeks after he lost control of his Digicel telecoms group to a group of creditors.

Mr O’Brien is also due to be repaid almost €80 million in loans outstanding to the private hospital under the agreed sale. The profit estimate is based on a price of more than €400 million that the asset management arm of Australian financial services giant Macquarie is said to have agreed to pay for the Beacon.

Representatives for the Beacon, Mr O’Brien and Macquarie declined to comment on the value of the deal.

Mr O’Brien (65) acquired control of the Beacon in 2014 after buying, for an undisclosed amount, €105.4 million of loans tied to the business that were owed to Ulster Bank and units of the hospital’s then majority owner, US-based healthcare group UPMC.

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The Jersey-based vehicle that Mr O’Brien used to take control of the Beacon, Linkbey Investments Holdings Limited, subsequently injected €94.9 million of equity into the Beacon in 2015, with €83 million of this used to replace debt owed to the businessman.

This put the company on a firmer financial position and able to take on loans from Bank of Ireland, which would grow from €13.8 million at the end of that year to €88.5 million by December 2022, said financial statements for Beacon Medical Group Sandyford Limited, the company behind the hospital.

[ Denis O’Brien’s Beacon Hospital sold to Macquarie for estimated €400m ]

In 2016, the company borrowed €107 million from a unit of O’Brien’s Linkbey to settle a previous deal where a group of legacy investors could have taken a stake in the hospital. In the near decade under Mr O’Brien’s control, the Beacon would invest about €120 million expanding its facilities to now comprise 251 beds, eight operating theatres, three cath labs and four endoscopy suites, as well as acquiring the adjacent Beacon Hotel in 2020.

An Bord Pleanála granted permission last year for a €75 million redevelopment of the hotel, which would add 70 new beds.

At the end of 2022, the Beacon owed Mr O’Brien – who now owns 80 per cent of the business through another ultimate holding vehicle, called Sayum Holding Corporation – and minority shareholders, led by chief executive Michael Cullen and fellow hospital co-founder Prof Mark Redmond, some €98 million. Splitting the debt along the lines of ownership suggests O’Brien is owed €78.4 million.

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The deal marks a further shrinking in recent times of the empire O’Brien started to build three and a half decades ago.

Last month, the businessman saw his stake in Digicel, which spans 25 markets across the Caribbean and Central America, fall to 10 per cent as a group of bondholders took control under a $1.7 billion (€1.57 billion) debt-for-equity-swap. Digicel was founded in 2001 after O’Brien netted about €200 million from his sale of Esat Telecom mobile phone group to BT Group the previous year.

[ Digicel completes restructuring that cuts O’Brien stake to 10% ]

In 2021, the businessman sold the Communicorp media group he had set up in 1989 to secure the licence for Dublin radio station 98FM for a sum in the region of €100 million to Germany’s Bauer Media Group. By then, Communicorp’s stable included Spin1038, Newstalk and Today FM. Mr O’Brien had transferred his UK radio assets to a separate Isle of Man vehicle in 2017.

In 2019, the businessman received €43.5 million for his 29.9 per cent stake in Independent News & Media, as the publisher was acquired by to Belgium-based Mediahuis. The deal crystallised a €450 million loss for O’Brien, who shelled out an estimated €500 million-plus building the holding between 2006 and 2013.

[ You can rent Denis O’Brien’s superyacht - for a price ]

Mr O’Brien sold fuel retailer Topaz in 2015 for an estimated €450 million to Canadian company Couche-Tard. He had picked up the business two years earlier by buying its €300 million of loans, from Irish Bank Resolution Corporation (IBRC) for about half their original value.

The businessman’s remaining high-profile assets include Actavo, a construction and infrastructure services company once known as Siteserv, which he acquired in 2012 in a deal that involved IBRC writing down €119 million of company loans; his Quinta do Lago golf resort in the Algarve in Portugal; the PGA Catalunya resort in northern Spain; Ballynahinch Castle in Co Galway and a collection of other property interests.

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times

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