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PRESS DIGEST-Australian Business News - Dec 19

Source: Thomson Reuters Foundation - Tue, 18 Dec 2012 20:08 GMT
Author: Reuters
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Compiled for Reuters by Media Monitors. Reuters has not verified these stories and does not vouch for their accuracy.

THE AUSTRALIAN FINANCIAL REVIEW (www.afr.com)

Whitehaven Coal has urged its Chinese suitor Shenhua Group to launch a full takeover bid for the Australian miner after Shenhua's attempt to roll its coal assets into Whitehaven collapsed. The deal would have given Whitehaven equity in Shenhua, but Whitehaven's board rejected the proposal. Any offer would require the approval of the Foreign Investment Review Board, along with major shareholder Nathan Tinkler and his financiers. Page 13.

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Mike Smith, chief executive of Australia and New Zealand Banking Group, received more than A${esc.dollar}19 million last year, almost more than double the A${esc.dollar}10.1 million salary disseminated by the press. The high "take-home" pay was uncovered in the bank's annual report and was a combination of his fixed salary, cash bonuses and share-based payments that only vested this year. Mr Smith's remuneration is expected to be criticized by shareholders at the company's annual general meeting today, following similar complaints last week from investors in Australia's other major lenders. Page 13.

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Peter Townend, an Australian surfing icon who became the first world surfing champion in 1976, yesterday described his long-time friend and former rival Paul Naude as having the "true DNA" of embattled surf, ski, street and skate wear retailer Billabong International. "In more recent times Billabong has been sidetracked. Sure was there making some decisions, but in last decade they made too many acquisitions and had too much retail and management couldn't handle it," he said. Mr Naude has allied with a consortium to issue a A${esc.dollar}527 million takeover bid for Billabong. Page 15.

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Singapore Airlines will add a fourth daily service between its base in Changi airport and Melbourne from July this year in a bid to solidify its market share before the agreement between rival carriers Qantas Airways and Emirates Airlines is approved. Singapore's total number of services per week from Australia will increase to 121 for a result, having already added 17 weekly services over the last year. Page 15.

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THE AUSTRALIAN (www.theaustralian.news.com.au)

OzForex, the foreign exchange services provider backed by investment bank Macquarie Group, has announced plans to double its operations over the next four years. "We have a good opportunity to take some substantial market share. We will have 10 to 12 staff in the United States by the end of the financial year," Simon Griffin, southern hemisphere head for OzForex, said yesterday. The company has already expanded into Hong Kong and has applied for a license in Singapore. Page 17.

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Investment house Macquarie Bank has gained ground on multinational rival UBS in the services market for institutional shareholders, according to the latest Overall Sales and Trading Relationship Strength indices. UBS was still the most popular broker for trading and research among institutional investors, with Macquarie runner-up and Morgan Stanley "arguably" the most improved firm of 2012. "We're very pleased that we've shown improvement across the board in challenging market conditions," Macquarie head of Australian research Matt Nacard said. Page 17.

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PetroChina has filed a A${esc.dollar}185 million takeover bid to acquire WestSide, making the oil and gas producer the first Chinese company to buy an Australian coal-seam gas (CSG) miner. The two parties reportedly will make an announcement early in the new year at the latest, and comes after various Chinese groups expanded their holdings of Queensland's CSG sector. PetroChina also jointly purchased CSG developer Arrow Energy with energy giant Royal Dutch Shell two years ago for A${esc.dollar}3.2 billion. Page 17.

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Etihad Airways has brokered a A${esc.dollar}250 million agreement with German partner Air Berlin, the first phase of a process to form a global loyalty management firm that would increase revenues from the loyalty program industry. The Middle Eastern airline already owns a 10 percent stake in Australian carrier Virgin Australia, along with an extensive code-sharing agreement that saw rival Qantas Airways broker a similar deal with Dubai-based carrier Emirates Airlines. Page 17.

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THE SYDNEY MORNING HERALD (www.smh.com.au)

News Limited, the Australian arm of media conglomerate News Corporation, yesterday announced a A${esc.dollar}476.7 million loss for the 2011-12 financial year, a period that saw the company book A${esc.dollar}731.7 million of write-downs and suffer a 11 percent drop in revenues to A${esc.dollar}2.6 billion. Operating income also slumped by 23.5 percent to A${esc.dollar}493.6 million, with the accounts citing falling advertising revenues "driven by negative consumer sentiment". Page B1.

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Figures due to be released today by the Australian Taxation Office will show that investors are injecting A${esc.dollar}26.5 billion annually into self-managed superannuation funds, with the fast-growing market putting pressure on the remainder of the retirement savings sector. Since 2008, the self-managed industry has grown by just under a third with nearly A${esc.dollar}440 billion in assets under management in June. Federal Superannuation Minister Bill Shorten said self-managed super was "the largest sector of the Australian superannuation industry". Page B1.

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Global credit ratings agency Moody's Investors Service has proposed reforming the algorithms used to devise its sovereign debt ratings, following criticism of the methodology in the wake of the global financial crisis and several sovereign debt crises. The group has proposed using 15 potential scores instead of five, which would increase the "scope for analytical differentiation". John Sorrell, head of credit at investment group Tyndall, said the sovereign ratings industry had transformed over the last few years from "being one of the most boring parts of the market to the more interesting". Page B1.

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A British newspaper report has claimed that the deputy editor of The Guardian has been appointed to lead the publication's online expansion into Australia, only days after staff at The Guardian voted to strike if the company made voluntary editorial redundancies compulsory. According to the London Evening Standard, Katharine Viner would head up a Guardian Australia team that would work alongside the founder of accommodation website Wotif.com, Graeme Wood. A spokeswoman for The Guardian declined to comment on the report. Page B2.

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THE AGE (www.theage.com.au)

Minerals and Metals Group (MMG), an Australian-based miner that is a wholly owned subsidiary of resources trader China Minmetals Corporation, yesterday announced it would launch a campaign to raise nearly A${esc.dollar}1.2 billion to fund the construction of a new silver, lead and zinc mine. "This will be a significant investment for MMG and one which demonstrates our confidence in the long-term outlook for zinc," Andrew Michelmore, Australian chief executive of MMG, said. Page B4.

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Uranium producer Toro Energy could have a difficult day's trading tomorrow after Federal Environment Minister Tony Burke sought to push back a decision on the company's Wiluna mine in Western Australia for the second time. The previous deadline has been postponed until the end of March next year and drew the ire of Greg Hall, chief executive of Toro. "There will be a gap of up to six months between the decisions of the two jurisdictions, when the bilateral agreement was meant to ensure a harmonization of the process," Mr Hall said. Page B4.

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Explosives and fertilizer manufacturer Incitec Pivot yesterday announced a 24 percent drop in profit to A${esc.dollar}404.7 million, a result that chairman Paul Brasher described as "disappointing". "Some parts of our business have performed extremely well and others have had a difficult year," he remarked. Earnings before interest (EBIT) from Incitec's fertilizer division slumped by 40 percent to ${esc.dollar}270.9 million, although the explosives arm recorded an 8 percent rise in EBIT to A${esc.dollar}399.9 million. Page B4.

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Paint manufacturer DuluxGroup yesterday announced that its "like for like" full-year net profit should exceed the A${esc.dollar}79.6 million it recorded last financial year, while it was also coming towards the end of a protracted takeover bid for roller-door and building materials supplier Alesco Corporation . "After completing the first two months of the 2013 financial year, we are seeing positive sales growth, with all four business segments ahead of the same time last year," Patrick Houlihan, chief executive of DuluxGroup, said to shareholders. Page B4.

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