A tech titan's Welsh dilemma Newbridge billionaire Terry Matthews has big plans for his homeland. Some wish he'd leave well enough alone.
Monday, May 3, 1999
Alan Freeman
European Bureau
Globe & Mail
Newport, Wales -- Terry Matthews made his fortune in Canada's Silicon Valley, but he's a boy from
the coal-mining valleys of southern Wales and doesn't want anyone to forget it.
Mr. Matthews is founder and chairman of Newbridge Networks Corp., the high-technology firm based
in the Ottawa area that made him the first Welsh billionaire.
It takes its name from his hometown (found not far from Newport), where he was born on Main Street
-- coincidentally the name of a telephone-switching system Newbridge sells.
He is 55 and lives in Ottawa now, but his mother, Lillian, says "the money hasn't changed him at all."
However, his money is certainly changing where he comes from.
Just as Canadian auto-parts magnate Frank Stronach has become a major investment presence in his
native Austria, Mr. Matthews is determined to leave a legacy to the land of his birth.
The European headquarters of Newbridge Networks is here, and just across the road, on a hillside
overlooking the M4 highway, workers are putting the finishing touches on a $250-million addition to the
Matthews-owned Celtic Manor Hotel.
It's a mammoth place, which will have 400 bedrooms, 29 meeting rooms, an 1,800-seat ballroom and a
luxurious health club. He has bought up 570 hectares of surrounding farmland and is about to open the
third of his four planned golf courses.
But it is on the far side of another hill -- in the Usk River Valley, about a kilometre away -- that Mr.
Matthews intends to leave his real mark as a loyal son of Wales. He has proposed building a
$17.5-million "centre of excellence" for rugby, Wales's national sport.
Rugby "is interwoven with our society," he said after the project was announced. "When the team is
doing badly, everyone feels it."
Unfortunately, his enthusiasm is not shared by all. In fact, the plan has stirred up a hornets' nest.
Mr. Matthews has donated 11 hectares of land in the Usk Valley to the Welsh Rugby Union along with
a "seven-figure sum" (which would mean at least $2.5-million) toward building what he calls "the best
school for rugby on the planet."
But environmentalists and many local residents consider the project an act of pure megalomania. "Terry
Matthews is seen here as building a Babylon temple to himself," said Cliff Hegan, a leading opponent.
"If you've got $1.6-billion [U.S], you've got to do something with it."
That the 55-year-old Mr. Matthews would want to "do something with it" in Wales comes as no
surprise. As his mother, who still lives in Newbridge, told a Welsh newspaper: "Even though he left for
Canada to seek his fortune, he never forgets where he comes from. . . . He tries to come home as often
as possible."
His dedication to his birthplace is uncannily like that of Mr. Stronach. The founder of Magna
International Inc. has built his European headquarters in a development near Vienna that also includes a
golf course with clubhouse styled very much like Celtic Manor.
He also has ambitious plans (a leisure park, horseracing track and hotel), has encountered opposition
from environmentalists, and has invested heavily in a favourite sport (soccer).
There is one apparent difference between the two. Mr. Stronach has employed Magna's money rather
than his own for his initial investments, while Mr. Matthews has kept Newbridge Networks out of the
picture. "For me, personally," he said, "this has nothing to do with business. It's emotional."
It's equally emotional for Mr. Hegan, who lives with his family in a 250-year-old converted fisherman's
cottage about 1.5 kilometres down the Usk River from the proposed site. "We want to live in a beautiful
place in a house full of character," he said, "and we don't want to see it changed or spoiled."
Both the location and the scale of the project worry opponents. Last month, 400 of them attended a
public meeting to express their displeasure at seeing 11 hectares of pasture and marsh transformed into
six rugby pitches, a 500-car parking lot, a 1,500-seat stadium and an administration building with
gymnasium and dormitories.
The British government's Environmental Agency has lodged a formal protest, noting that the centre
would be built on a floodplain and that the valley is designated "a site of strategic scientific interest"
because of its abundant bird, fish and mammal life.
"It's really incomprehensible that somebody is proposing to build something of this nature next to a site
of international wildlife importance," said Carol Hatton of the World Wildlife Fund.
Neighbouring residents question the wisdom of allowing urban sprawl into a rural area rich in Roman
ruins.
"In his personal sphere of excellence, Mr. Matthews is a world leader," said Chris Holbrook, who owns
seven hectares overlooking the site, "but as a custodian of chunks of his homeland, I don't rate him
very highly."
Mr. Holbrook, a computer consultant, worries that the 1,500-seat stadium is just the beginning. "The
hotel started small, but the place has gone on steroids. It's got bigger and bigger and bigger.
"How long is it going to be before we see the first pop concert? I won't be able to get my astronomical
telescope out at night and see the stars because of the floodlighting. This is going to have a hell of an
impact on our life and we resent it."
Terry Matthews as megalomaniac and cause of resentment seems an odd notion, given the relatively
low profile he has kept over the years.
After growing up in Newbridge and earning a degree in electronics at the University of Wales, he left for
Canada while in his 20s. He first made his mark (and part of his fortune) as the co-founder with
Michael Cowpland of high-tech pioneer Mitel Corp., which both eventually left but which still has a
large plant in Wales.
Unlike Mr. Cowpland, the high-profile head of software maker Corel Corp., Mr. Matthews eschews the
limelight. In an oft-quoted interview, he told a Welsh newspaper: "If anybody is looking for me to
become a local entrepreneur, a local sort of high-profile, flamboyant, purple-Cadillac type, don't look
for that."
Mr. Matthews has his fans. "There are a lot of people around here who only see this [the rugby centre]
as a positive development for the region," said Steve Howell, a local spokesman for Mr. Matthews.
"Wales has never had anything like this."
David Barnes agrees. "We're quite proud of him," said the business editor of The South Wales Argus,
the local newspaper. "If he wasn't here, nobody would be putting that sort of money into Newport."
The hotel, he notes, will add 200 jobs to the local work force when the addition opens this summer.
One of the people preparing for that day is Dylan Matthews, who at 29 is the oldest of Mr. Matthews's
four children and has given his name to Dylan's Health and Fitness Club at Celtic Manor.
As workers put the finishing touches on the marble floor at the base of the giant atrium, the younger
Mr. Matthews points to two bare concrete columns on which 2.4-metre Welsh dragons of solid oak will
soon be mounted. They were inspired by sculpted elephants his father has seen in Oriental hotels, he
said.
For business, Celtic Manor will depend primarily on company meetings and golfers -- all four courses
are the work of famed designer Robert Trent Jones Jr. (The senior Mr. Matthews dreams of one day
staging the Ryder Cup, a match pitting a U.S. team of golfers against a European team, though he says
he doesn't play the game himself.)
The hotel's initial bookings include 140 couples from the International Senior Amateur Golf Societies,
but Dylan Matthews conceeds that it will be "a big challenge to sell these 400 bedrooms."
That's why its opponents suspect that the rugby centre is designed just to be another drawing card -- an
accusation Mr. Howell denies.
"There is no commercial connection at all between the Welsh Rugby Union centre of excellence and the
Celtic Manor," he insisted, even though Mr. Matthews has said he will contribute the $2.5-million only
if the centre is built on his land.
Terry Cobner, director of rugby at the Welsh Rugby Union, said the organization is thrilled to be part of
the Celtic Manor development and has looked at no alternative sites, even though opponents say there
are plenty.
"If somebody else had given us 30 acres of land and a substantial donation, we would have been
delighted to look elsewhere," he said. "Unfortunately, Wales doesn't have that many millionaires."
Mr. Howell dismisses the concerns of the project's impact as exaggerated. "I don't think that six rugby
pitches and a small administration building will mean that there will be a great urban sprawl taking
place."
The stadium probably won't be used more than six to 10 times a year, he said, and precautions are
being taken to minimize light pollution. As for the road planned to link the valley with the hotel, Mr.
Howell described it as "a buggy path" that will follow the contours of the hillside.
None of this sways the project's opponents, who have pinned their hopes on an environmental
assessment study, although they are not overly confident.
"We're up against the most powerful body in Welsh sport and we're up against the wealthiest man in
Wales," said Andrew Pimblett, one of the group's leaders. "He's a very tenacious guy. He's in this for
the long term."
PLEASURE DOME DECREED
Intro: Terry Matthews made his first hotel investment in Wales in 1980 when he bought an abandoned
maternity hospital on the M4 highway. It happened to be the place where he was born.
Reno: He redid the building, once a stately home, into a 17-room luxury hotel, with his sister as
resident manager. In 1988, the hotel was extended, and supplemented in the 1990s with two golf
courses and a $25-million clubhouse.
Gonzo: The latest addition, in effect, creates a new hotel that would look more at home in Las Vegas
or Florida. Everything about the place is huge. "I think the Celtic Manor can act as a magnet to draw
new investment into Wales from across the U.K. and overseas," Mr. Matthews says in a publicity
document for the new hotel.
The result: "I did my best to put up a building that you can see from the West End of London, and I
didn't come far short of it," he adds. In fact, critics say, he added a couple of floors after the local
council failed to include height restrictions when approving the original design.
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