Gallagher, Charles (1927–93), businessman, was born 20 January 1927 at Cashel, Curry parish, Co. Sligo, the second youngest of fourteen children of Matthew Gallagher, farmer, of Cashel, and his wife Margaret (née Reilly). Growing up on a small family farm, he attended Moylough national school and played Gaelic football. Meanwhile, his brothers Matt (qv), James (qv), Hubert, Dan and Joe prospered as builders in England and paid for his education at St Nathy's College (a boarding school) in Ballaghaderreen, Co. Roscommon, and then at TCD where he studied civil engineering. His catholic family defied their church by not seeking its permission for Charles's attendance at a university predominantly attended by protestants.
In 1947 he left TCD without completing his degree and joined the family business in England, starting by digging ditches and driving trucks. He impressed his brothers, who were developing an industrial and homebuilding conglomerate straddling the Irish Sea that became known as the Abbey Group. After a period in the doldrums, the British building operation, Abbey Homesteads, revived strongly in the mid 1950s as restrictions on private housebuilding were lifted. By 1959 Charles was Abbey Homesteads' managing director, his older brothers having returned to Ireland.
Based in offices in Southgate, London, his operations focused on that city's vast hinterland. Eschewing land speculation, he built as quickly as possible on a small land bank and generally bought properties with planning permission, often making contracts conditional on such permission being obtained. A medium-sized building company in British terms, Abbey Homesteads went from producing 150 houses yearly in the early 1960s to around 650 in 1973, latterly building shopping centres in the larger estates and supervising commercial and apartment developments in Cyprus. He was also responsible for a plant hire company, M and J Engineering Ltd, which grew rapidly during the 1960s. In 1973 Gallagher managed over 390 employees and a further 260 subcontractors.
He did not privilege his compatriots when hiring labour, leading to accusations of ethnic disloyalty. Yet he never lost his accent and was active in the London-Irish community. Elected chairman of the prestigious Irish Club in London in June 1969, he resigned within a year after the club's council refused to support his efforts to restrain unruly members. Identifying with even his poorest fellow emigrés, believing they all shared an acute sense of being rejected by their homeland, he then became chairman of the Irish Centre, which assisted needy Irish emigrants.
With his wife Pauline (née Fitzsimons), daughter of a Dublin bookmaker, he had nine children, not least because his Irish catholic education had instilled a complex about using contraceptives. He sent his children to non-catholic schools, as he did not want them to undergo a similar indoctrination, and was appreciative of the greater freedoms and opportunities afforded by British society. The family lived at Moor Park, Northwood, in Middlesex, while also having a London townhouse and a Dublin residence at Foxrock. Quiet-spoken (unless crossed) and somewhat dour, he had a weakness for clunky gold jewellery and always owned the newest-model Rolls Royce.
Charles revered his brother Matt, the original driving force behind the Abbey Group, and was dismayed when he left in 1957 to be succeeded by another brother, James, who guided the establishment of three factories in Tubbercurry, Co. Sligo, making builders' hardware. Owing little to financial logic and much to James's soon fulfilled ambition to become the local Fianna Fáil TD, this manufacturing division was a financial drain, but to Charles's disgust James would not countenance its closure. In contrast to his garrulous and ingratiating brother, Charles expressed himself tartly and concisely, these personal differences made manifest in conflicting corporate philosophies.
Associating James with the suffocating cronyism and tolerance for mediocrity that he saw as the bane of Irish life, he further resented that his brothers had returned home to be lionised as munificent employers, while he continued as an unsung exile, obliged to carry the rest of an inefficient, haphazardly organised conglomerate. In 1973 his operations boasted a 31 per cent profit margin to the Irish sections' 9.1 per cent. He regarded this disparity as all the more egregious given that the English housing market was more competitive and strictly regulated than the Irish one.
When the Abbey Group was floated on the Irish stock exchange in 1973, he received £713,000 and a 19.3 per cent stake, initially worth £4.3 million. He also became managing director of the entire group, then Ireland's third largest publicly quoted industrial company. However he still had to contend with his brothers James, Hubert and Patrick, who owned over 50 per cent of the company among them and maintained their own independent fiefdoms in Ireland, ignoring his urgings to concentrate more resources on England.
Recriminations among the headstrong, combustible siblings escalated from late 1973 when a property crash in both Britain and Ireland plunged Abbey into crisis, one dispute culminating in a brawl whereby Charles knocked his brother Patrick unconscious. While Charles's longstanding criticisms remained valid, his position was weakened by the fact that he had misread the market and spent heavily during 1972–3 in acquiring sites that had since dramatically lost value. Abbey was at the mercy of its bankers, but Charles refused to accept the need for retrenchment, allowing James to outmanoeuvre him.
In July 1974 he resigned as managing director of the Abbey Group, but intended continuing as managing director of the English division. Instead James, with the support of Patrick and Hubert, dismissed him by letter from all his positions within Abbey. After a two-week impasse in which he continued to work in his office, he withdrew and pursued legal action for wrongful dismissal, eventually receiving £22,500 compensation. James imposed steep write-downs on the value of Abbey's English land assets while leaving the similarly afflicted Irish land bank untouched, which Charles interpreted justifiably as accounting trickery designed to discredit him.
Thereafter he appeared at successive Abbey AGMs to decry the group's management, memorably pointing to the list of directors' emoluments and declaiming: 'I know you draw a helluva lot more than that' (Ir. Business, February 1985). At the 1975 meeting he exacted a measure of self-defeating vengeance by announcing his intention to sell his shareholding, which lastingly depressed the share price and eviscerated all the Gallaghers' paper wealth. His brothers tried to resolve this uncertainty either by finding a buyer for him or by purchasing his shares themselves. All failed, partly because the share price remained too low for him to get any value, but also because he nurtured hopes of a comeback.
In 1975 he set up his own company, Matthew Homes (named in memory of his brother), proceeding to outperform Abbey in the housing market in the south-east of England. By the mid 1980s, Matthew Homes approached Abbey in size in England and was believed to be earning £3–4 million a year. An advocate of the virtues of self-employment, he contracted as much work as possible and kept overheads to a minimum. Likening delegation to abdication, he believed that managers had to impress their personal authority on all their subordinates, an impossibility in large organisations. He regarded bureaucratised conglomerates as akin to nationalised concerns: neither provided scope for individual initiative, both enabled management to carve out a safe, protected niche.
In 1978 he could afford to spend £500,000 on a mansion in Welwyn, Hertfordshire, complete with a 116-acre estate, gardens and an airstrip. Three years later he bought a house and 200-acre estate in Ashford, Co. Wicklow, where he farmed. As he felt vindicated by success and by Abbey's ongoing difficulties, his bitterness faded and he desisted from disrupting Abbey AGMs. In 1981 he sold half his Abbey shares, reducing his shareholding to 8.5 per cent.
All changed utterly when James's death in spring 1983 precipitated a power struggle within the ailing Abbey group whereby James's heir Seamus was sidelined. Seamus had always expressed sympathy for Charles and seems to have inherited personal guarantees for Abbey's debt. Charles convinced his nephew that he alone could retrieve matters and accumulated Abbey shares. By September he had a 15 per cent stake to add to Seamus's 26 per cent. Patrick and Hubert mounted some last-ditch resistance, before capitulating under pressure from institutional shareholders, who supported Charles as the Gallagher most likely to deliver.
Once installed as chairman, he based himself in Ireland, relinquishing the management of Matthew Homes to his sons. At Abbey he stopped dividends, forced out executives and amputated mercilessly: the Irish manufacturing and trading subsidiaries were either closed or sold off, and Abbey exited the depressed Irish building trade, selling what it could of its land holdings. The Irish-based builders' providers firm P. J. Matthews received a stay of execution before being closed in 1987 after a failed bid to turn it around. By the end of 1984 staff numbers had fallen from over 1,000 to 535, and Abbey, now on a firm financial footing, had effectively become an English homebuilding company.
These measures necessitated significant job losses, but met with resigned acceptance amid a prolonged and morale-sapping recession. Nobody disputed his contention that the only builders making money in Ireland were those operating out of the boot of their car. Moreover, his methods were admired by his business peers and by Irish investors for representing the further disintegration of a malfunctioning corporatist consensus that had long suppressed returns to capital. Abbey's share price finally showed signs of life, attracting support from Irish institutions as the streamlined company was focused on a roaring English housing market. In late 1984 he pushed his shareholding up to 28.8 per cent by buying 2.5 million shares from his deceased brother Hubert's heirs.
Meanwhile, Seamus Gallagher was aggrieved by the dismantling of his father's legacy and meditated vengeance with his brother Donal and uncle Patrick. In October 1985 the trio revealed that, desiring to cash out of Abbey, they had thrown their combined 36.4 per cent shareholding behind a hostile takeover bid by the French Kier company. It was anticipated that the existence of a large bloc of Gallagher shares seeking a buyer and the renewed family infighting would scare investors into accepting French Kier's opportunistic offer. However, having finally imposed his will on Abbey, Charles was not about to have it sold from under him, and a ferocious tussle ensued, involving exchanges of legal writs, allegations of share price manipulation, and a bonanza for Dublin's stockbrokers.
Retaining two investment banks to advise him, he spent £543,000 on convincing the market that Abbey's shares represented value in comparison with other building companies operating in the south-east of England. Indeed the controversy worked to his benefit as it drew the attention of the London institutions, which had long ignored Abbey due to its Irish stock listing, but now snapped up its shares. His son Charles played a crucial role in winning and retaining their confidence, deploying to good effect the connections, accent and class mannerisms acquired from his education at Harrow and Cambridge. Charles junior's prominence within the Conservative party also helped – he would unsuccessfully contest a seat in the 1987 British general election.
Abbey's share price remained comfortably above French Kier's initial and subsequently improved bid, and as it became apparent that he would prevail, Charles put out feelers to his estranged relations. In mid December, he arranged the disposal of their 38.7 per cent shareholding to some forty financial institutions, mainly British, for only slightly below the market price. This was the second-largest placing of Irish shares, confounding experts who had considered the disposal of such a large volume of stock to be impossible. The feud ended with both sides emerging satisfied beyond all expectation and deserts. In six weeks, some 60 per cent of Abbey's equity had changed hands leaving financial institutions holding 63 per cent and the company with a more attractive spread of shareholders. Abbey's ownership was now concentrated in Britain, and for tax reasons Gallagher transferred its headquarters there from Ireland. He likewise sold his Wicklow dwelling and moved back to England where he had a country mansion at Toddington Park in Bedfordshire.
Abbey's homebuilding operations thrived as annual output rose from 600 houses in 1984 to 1,000 in 1988, and as soaring house prices drove profits from £3 million in 1984/5 to £17 million in 1986/7. Having previously ignored investors and market analysts, from 1987 he courted them assiduously, hyping Abbey's prospects so effectively that its share price rose from 128p at the start of 1986 to 600p by autumn 1987. His shareholding was then worth £43 million, ranking him among the wealthiest Irishmen. Concerns regarding conflicts of interest arising from Gallagher's ownership of Matthew Homes and control of Abbey proved largely unfounded, as the two firms avoided competing with each other. The plant hire segment, which had twenty-two depots by 1989, served as a cash cow and also as a hedge of sorts, its business cycle trailing that of the building sector.
With land prices in London's commuter belt rising by up to 50 per cent during 1987–8, he was initially wary, but as he ran out of sites, could not countenance idleness and began expensively accumulating property. Significantly, an increase in debt was moderated by raising £11.6 million from a share placement enacted on the last day of trading before the October 1987 stock market crash. He continued buying and borrowing well into 1988 before abruptly reversing course in August, just as the market was about to implode, selling 15 per cent of his land bank for £22 million. This inspired decision, initially criticised as precipitate, and the fortunate timing of the aforementioned share placement, ensured that Abbey narrowly survived what he described as the worst property slump he had experienced in forty years of homebuilding.
In 1989/90 Abbey went from a prior year profit of £18.7 million to a loss of £15.5 million and investor confidence collapsed when he sold some of his stock in order to repay borrowings incurred by Matthew Homes, which was also in straits. From 1987 to 1991, Abbey shares plunged by 80 per cent. As the crisis intensified in 1990 he revamped his management team, even taking over as chief executive for a year in order to implement stringent economies. These travails thwarted an intended return to the Irish market, and although an office block on Fenian Street in Dublin was completed in 1990, he missed out on a brief Irish upswing in 1988–90. By 1992 Abbey's staff numbers, turnover and housing had all at least halved from its late 1980s peak, but thanks to aggressive price-cutting it emerged with its debts cleared and some £17.5 million in the bank. Matthew Homes also survived, although it was significantly smaller than Abbey by the 1990s.
Latterly, his wayward nephew Patrick Gallagher (qv), son to Matt, caused him considerable embarrassment and expense. Charles provided Patrick with financial assistance after his building company went spectacularly bankrupt in 1982, subscribed £250,000 in 1986 towards the completion of a Dublin art gallery begun by Matt as a philanthropic gesture but then neglected by Patrick, and provided £100,000 sterling for Patrick's bail when he was arrested for fraud in London in 1988. Following Patrick's conviction in 1989, Charles refused to contribute towards the £1 million sterling demanded by the courts, effectively condemning his nephew to jail.
Charles Gallagher died in an English hospital on 15 May 1993 after a short illness and was succeeded as principal of Abbey and Matthew Homes by his son Charles. Under his capable and cautious leadership Abbey re-entered the Irish market in the mid 1990s and was one of the few Irish construction companies to survive the 2007–8 crash.