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CBD

 

A handy rule if you're a Qantas director

Qantas appears to have one rule for passengers, one for staff and another for its board of 11 directors.

One CBD spy checking in for flight QF94 from Los Angeles to Melbourne on Friday was surprised that some passengers were unable to get a seat and had to be bunked up for the night in the City of Angels.

Obviously those discounted tickets are selling well despite the downturn. Our informant also noticed that Qantas director Patricia Cross struck it lucky along with four other family members.

Any normal Qantas staff member would have had Buckley's chance of a seat but the US-born Cross and her clan do not travel as staff members.

Cross, we are told, used her FOC (free of charge) tickets to score a first-class berth for herself and her husband, who also reportedly challenged the Qantas staff policy no-no of wearing jeans at the snotty-nosed end of the aircraft.

The former Chase Manhattan banker and NAB director's three children had to rough it in business class. They allegedly raised the eyebrows of several passengers by breaking the Qantas staff dress code by wearing shorts.

But apparently FOC passengers are not required to abide by the dress code. Or as the airline said in a statement to CBD: "These arrangements are provided separate to the Qantas staff travel scheme and are not governed by the scheme".

Qantas tried yesterday to hose down any further negative publicity, noting that the economy passengers bumped off the flight were not only given hotel rooms but upgraded to business class on the next day's flight, if they chose not to be compensated.

As for Cross, Qantas said: "We do not discuss the travel arrangements of individual passengers, including directors but, consistent with practice in the airline industry, Qantas directors and their nominated direct family members or partners are entitled to a limited number of flights for personal purposes as part of their remuneration arrangements."

Cross failed to return phone calls to provide her version.

Lipstick on a pig

Finally some good news for debt-stricken Babcock & Brown Infrastructure.

It appears the company that wants to change its name back to Prime Infrastructure Group will be able to use the share ticker PIG.

The share code has been out of service since the Fijian mineral explorer Pacific Island Gold merged with Burdekin Resources in 1999.

The ticker DOG is also up for grabs, while COW appears to be free 15 years since Cowden Ltd failed to pay its listing fees.

Big deal for Sam

Organ recipient and former Nine Network boss Sam Chisholm will join Daryl "Hey Hey" Somers as the latest former television identity to dust off the cobwebs.

Chisholm has booked out his chum Guillaume Brahimi's eatery in the Opera House today to celebrate his 70th birthday.

The guest list includes his fellow director at the Lifehouse cancer research centre at RPA, Max "the Axe" Moore-Wilton, former premier Neville "Nifty" Wran, stockbroker Colin Bell, former Labor powerbroker and lobbyist Laurie Brereton, former journalist and Consolidated Press Holdings director Trevor Kennedy and Sean Howard.

A sign for PwC?

Maybe the fire in the PricewaterhouseCoopers sign above its Sussex Street headquarters in March last year was a sign after all. Its Australian chief executive, Mark Johnson, has asked staff to take up to 15 days' unpaid leave by early next year to help PwC through "these tough times".

More than half of the firm's 6200 Australian staff have taken up the offer. "Our business remains sound but we have to adjust to the new conditions," he said in May.

And now the auditing and accounting firm, whose headquarters are in New York, has listed its Australasian arm as its worst performing contributor, after it reported that its US dollar revenues in the region fell 13.9 per cent on a constant currency basis in the 12 months to June 30.

The auditor might have suffered from its client Macquarie Group unwinding its web of listed satellites – not to mention the attendant non-audit fee treasure.

But maybe the outlook for the Australian arm has been skewed by the local dollar. The Sydney outpost recently said its revenues rose 1.1 per cent in the year to the end of April.
 
"In the past year, PwC has set out to increase transparency as part of our corporate responsibility commitment," the outpost said in its review.

It failed to disclose whether its profit also rose.

Rocky times

The pillar of Rockhampton's financial sector, The Rock Building Society, is looking to ward off the third attempt in as many years by out-of-towners to get more seats on the board. The Rock, chaired by John Maxwell, its Rockhampton-born director of 34 years, has urged shareholders to vote down resolutions to be pitched by a shareholder at a coming annual meeting to spill the board.

Maxwell has said: "It is tiresome to have to respond to the aspirations of opportunists." One resolution brought by Queensland Trustees and Investment, domiciled in Airlie Beach, that will be a crowd pleaser is to halve the remuneration pool of the board to $194,745.

QTI, which has a 3.3 per cent stake, proposes to ditch Maxwell and another director, Brad Beasley. QTI wants its managing director, Michael Hackett, and former Rock managing director Kerry Daly on the board.

In his long-winded letter to shareholders, Maxwell says: "It is not surprising that opportunists are seeking to take advantage of The Rock's enviable position by attempting to steal control by opposing Brad Beasley and myself and attempting to gain board positions to give them control for their own ambitions and ego satisfaction without having done the hard yards to get The Rock to where it is today and where it is positioned for the future."

Maxwell questions Daly's fitness to serve as a director, given that he is a former executive director of Lehman Brothers Australia.

Bad memories

Long-time Multiplex staff members had old memories stirred up yesterday when they fronted for a face-off with the scarf-wearing corporate agitator Nick Bolton at the Museum of Sydney's AGL Theatre.

Nick's plans to wind up the Multiplex Prime Property Fund might have been heavily voted down in a shareholder meeting closed to the media.

But we can only imagine the traumas that might have resurfaced. In February 2005 the former chief executive, Andrew Roberts, fessed up that the Wembley stadium in Britain had lost a bundle.

It was the start of a downhill slide that culminated in Multiplex's being taken over by the Canadian construction mob Brookfield. 

Email srochfort@smh.com.au 

Insider

 

Edited by Jamie Freed

BBI set to unveil recapitalisation
 
Canadians eye infrastructure assets Babcock and Brown Infrastructure hopes to unveil a long-awaited $1.75 billion recapitalisation deal as early as today after receiving sufficient backing for an institutional placement.

It seems some of the delays associated with the deal stemmed from the fact that Australian institutions were relatively unwilling to assist with the recapitalisation – their US counterparts were more open-minded.

In the end, Credit Suisse and Macquarie Capital have underwritten a $600 million or so institutional placement and $250 million share purchase plan.

Brookfield Asset Management will chip in at least $900 million to emerge as the new cornerstone investor with a 50 per cent stake in the Dalrymple Bay coal port in Queensland and all of PD Ports of Britain, although it may not have a majority of the company at a corporate level.

There are also suggestions Brookfield could receive a very cheap option covering the Australian Energy & Transmission Distribution portfolio BBI had gained through the ill-fated takeover of Alinta.

Initially, BBI had warned that the recapitalisation deal could lead to the conversion of all of its hybrid securities, which would leave little left for existing shareholders.

However, there are suggestions a full conversion might be averted as part of the extremely complicated deal. Brookfield is not the only large Canadian investor sniffing around Australian infrastructure assets.

Alberta Investment Management has told Canadian media it could announce one or two private equity deals – each worth about $C200 million – by the end of the year.

One of the options is an infrastructure deal in Australia. Canadian investors interested in Australia are looking beyond infrastructure.

Commonwealth Bank this week issued $C300 million of so-called "maple bonds" in the Canadian market, which had been relatively dormant of late.

Toronto's Globe and Mail said the five-year notes carry a 3.625 per cent interest rate and the raising was upsized from an initial $C150 million target in light of strong demand.

Trunk calls

On first glance, Telstra would appear to have enough on its plate – such as working out the best way to separate the company and rifling through submissions to a Senate inquiry made by citizens, fund managers and competitors.

Optus, for example, wryly noted that plenty of analysts had maintained "buy" recommendations on Telstra following the Federal Government's announcement of proposed reforms.
 
And it seems the regulatory pressure on the home front may not have prevented Telstra from pursuing overseas growth options.

India's Financial Express yesterday reported Telstra was among a slew of international bidders for 3G spectrum in that country, which would allow it to enter the wireless broadband market.

This would represent an intriguing strategic move for Telstra. Frustrated by local regulations, it exited its 49 per cent stake in Modi Telstra in 2000.

This is not the first time this year that Telstra has been linked to a possible investment in India. In February, Malaysia's Maxis Communication contacted Telstra to see whether it was interested in buying about 20 to 25 per cent of Indian telecom operator Aircel for up to $US2 billion.

Telstra did not bite. The market might not be pleased if Telstra chose to return to India. Citi analysts last month argued Telstra should exit all of its overseas investments and said they would strongly advise management against trying to expand its offshore assets in the pursuit of growth.

Meanwhile, some other operators are not finding the going easy in the Indian market. In response to a query about its recent share price decline, SingTel yesterday said increased competition in the Indian market, which would affect its 30 per cent stake in Bharti Airtel, could be to blame.

Dam buster

The temporary closure of the primary haulage shaft at Olympic Dam is bad news for BHP Billiton, but it is likely to prove a boost to rival uranium producers.

Olympic Dam represents only about 1 per cent of the world's copper production but it accounts for nearly 10 per cent of global uranium production.

In the past, when BHP has not been able to meet production quotas at Olympic Dam, it has been forced to buy uranium on the spot market to ensure deliveries.

Depending on the length – which Goldman Sachs JBWere said could be six months if the ore skip fell down the shaft – the outage could have a substantial effect on the thinly traded uranium spot market, and so the price of yellowcake.

Based on trading yesterday, investors are betting the reduced production from Olympic Dam will prove a boost to the uranium spot price, currently $US43.50 a pound.

The beneficiaries of any price rise would be existing producers, rather than the larger horde of hopefuls. BHP, Rio Tinto, Energy Resources of Australia and Paladin Energy are the only Australian-listed companies with current uranium production.

The latter two have by far the higher exposure to uranium prices. Yesterday, ERA shares rose 4 per cent and Paladin shares 6 per cent.

Interestingly, shortly before BHP revealed the problems at Olympic Dam, Canada's Mega Uranium said it planned to raise funds to help progress its Lake Maitland project in Western Australia.

The final size of the raising has not yet been determined but the BHP hiccup is unlikely to hurt Mega's chances of filling its coffers.

jfreed@smh.com.au

 

Briefs

Brewing

Kirin go-ahead The Federal Court yesterday approved a scheme of arrangement under which Kirin Holdings of Japan will acquire all of the shares it does not already own in trans-Tasman brewer Lion Nathan.

Liquor Industry

Six pubs sold Australia's biggest freehold pub owner has sold property worth about $37 million in a cyber-auction at Crown Casino in Melbourne. Ale Property Group sold six pubs all to private, individual investors, some of whom lodged bids via live video feeds.

Advertising

Clemenger move A Clemenger Group senior executive, Mark Coad, who heads the media buying agency OMD, will become chief executive of the advertising agency Clemenger Harvie Edge in the new year.

Resources

Timbercorp ruling Timbercorp  liquidator KordaMentha was justified in extinguishing growers' rights in selling Timbercorp's almond assets for $128 million to Olam International, the Victorian Supreme Court has been told. Leon Zwier, on behalf of the plaintiff Timbercorp Securities, said he required a direction by Friday that the liquidators were justified in entering into an agreement and extinguishing the growers' rights.