Depending on your point of view, he is either an entrepreneur worthy of The Apprentice and Dragons’ Den, or a “blood-sucking leech”.

Either way Duncan McDonald, a postman from Cardiff, is a man whose name can instil a sinking feeling in the stomach of the most blue-chip of businessmen.

McDonald, who spends his mornings delivering letters and parcels, is running a lucrative sideline in his free time, holding businesses to ransom by buying up their companies’ names under their noses.

The 43-year-old scans the internet for announcements about firms changing names or planning takeovers – and within hours he has nipped down the road to the headquarters of Companies House, which is based in the Welsh capital, and claimed the title for himself.

The process costs him just £20, but when the businesses realise they can’t have the name they want, he demands up to £100,000 to sell it to them. His practice was likened to the well-known phenomenon of “cyber-squatting” – the preemptive buying of internet domain names in order to sell them to firms at inflated prices.

But the embarrassment that McDonald inflicts on firms has ensured that his actions have largely been kept under wraps by the business community. Such is the opportunism of his scheme, however, that some bosses have even admitted to a grudging admiration for his “entrepreneurial spirit”.

McDonald has carried out the process, which is entirely legal, hundreds of times since his first attempt 13 years ago. One lawyer he has come into conflict with estimates he has earned a six-figure sum from his efforts.

“He is a leech,” said David Hansel, partner at the City law firm Memery Crystal. “He has been quietly and diligently getting on with this for years and it needs to be exposed.”

McDonald has aimed his sights at big businesses, such as BP, Shell and Taylor Wimpey, as well as many lesser-known brands. He has no fear of the power of celebrity either. Among those he has targeted in the past are the DJ Chris Evans and Bob Geldof, through a subsidiary of his media company Ten Alps.

Based in a flat in the rundown area of Splott in Cardiff, McDonald is currently listed as a director or company secretary of 45 companies, and has previously held a further 166 appointments. He frequently changes the names of his companies to match the name of the firm he is attempting to “sting” for cash.

His first attempt came in 1995 when he demanded £100,000 in exchange for the name Glaxo-Wellcome when the pharmaceutical giants merged. McDonald was forced in court to relinquish the title.

Undeterred, he successfully used the same procedure on countless other companies, often ending up being paid up to a modest four-figure sum for his efforts.

In 1998 McDonald, who was then describing himself as a full-time company registration agent, purchased the name of Chris Evans’s Ginger Media Group. The firm, which Evans later sold, apparently offered McDonald £1,000 for the name, which he declined. It is not known how the issue was resolved.

David Little was the company secretary of Intellexis plc when it came into existence seven years ago after a takeover. McDonald had bought the name Intellexis after seeing the takeover declaration and he was demanding £15,000 for it.

Little said McDonald was paid £2,000 on advice from the broker: “At the time there were complete panic stations,” he said.

In 2006 McDonald bought the name Ten Alps Publishing, the intended name of an offshoot of Geldof’s media group.

Alex Connock, chief executive and co-founder with Geldof of Ten Alps, was adamant he would not give any cash to McDonald. Geldof, who could not remember the incident, said: “Part of me is chuckling at his brass neck, but at the same time, if you were a small company, it would be an impediment.”

According to Hansel, who has compiled a dossier on McDonald, the Welsh postman has recently stepped up his work rate.

He said: “He seems to be going for less money, around £1,000 a go, but his rate of activity has definitely speeded up.

“Some lawyers and brokers acting for the firms have been so embarrassed by the fact that they may not have registered the company name quickly enough that they would rather pay McDonald than fight it.”

Kieron Harbinson, a director of Omega Diagnostics, which changed its name in 2006, said: “McDonald registered Omega Diagnostics Group ltd but that still prevented us from going with Omega Diagnostics Group plc. We made him a small payment of a few hundred pounds as we didn’t want any litigation.”

Stephen Hall, group commercial director for Animalcare Group, which was formed after a takeover in January, said his company had paid McDonald “a few hundred pounds. There are people like that who see an opportunity to make a lot of money”.

Others have resisted McDonald’s arm-twisting. Mick Pilsworth, former chief executive of the television company Chrysalis, was in the process of setting up Rumble TV in March when it was discovered that McDonald had taken the name.

“I felt like I had been mugged,” said Pilsworth, who obtained the name for free after his lawyers intervened. But McDonald’s era of backing businesses into a corner may soon come to an end. New laws that come into force in October will give companies the right to appeal if they can show that the main purpose of the person registering a name was to obtain money.

McDonald, a divorced father of two, said yesterday he was simply being “entrepreneurial”.

“I’ve done nothing to be ashamed of, but as far as I’m concerned it is ancient history now. Everything has been tightened up because people have realised what is going on.

“I’m not going into how much money I’ve made on it but, put it this way, I’m not a multi-millionaire.”

— Additional reporting: Roger Waite

How cybersquatters clean up

Cybersquatting is a term for small-time internet users buying website addresses associated with celebrities and companies to profit by selling them to their “rightful” owners.

One of the world’s most prolific buyers of celebrity domain names is a Canadian, Jeff Burgar, who has clashed with Tom Cruise, Pierce Brosnan and Kevin Spacey over websites incorporating their names.

Smaller operators include Arsenal fan Paul Averkiou who tried to sell manchesterunitedfc.com to the club for £100,000. Instead it registered Manutd.com and Averkiou’s domain name is still for sale.

In 2000 Michael Urvan won a ruling against the singer Sting before the World Intellectual Property Organisation over the website Sting.com when it decided his name was a common word.

Last year a man named Patrick Low sold a domain name for £5,137 to a telephone company in the Bahamas. A Swedish company of the same name tried but failed to obtain the site name.