PRESS DIGEST-Australian Business News - June 27

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)

Billionaire James Packer yesterday flew to the Philippines to sign off on a joint A${esc.dollar}1 billion-plus resort and casino venture with the Asian country's richest family. Manila is fast becoming the next gambling centre of Asia behind Singapore and Macau, with the government PAGCOR entity looking to generate US${esc.dollar}10 billion of gambling revenue in the area by 2017. Page 15.

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Don Voelte, the newly appointed chief executive of Seven West Media, yesterday said that there would be "wreckage" in the media sector as a result of recent transitioning which could present "some opportunities for us". "You're seeing some natural fallout of some people in their businesses," Mr Voelte clarified. Richard Goyder, managing director of conglomerate Wesfarmers, yesterday said the hiring of Mr Voelte was similar to his decision to appoint a former executive of fast food chain McDonald's to head up the Kmart discount retailer. Page 15.

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Andrew Forrest, chairman of Fortescue Metals Group, yesterday was unsuccessful in his attempt to acquire A${esc.dollar}294 million in the iron ore producer's shares after investors raised concerns about the motives behind the proposed acquisition. Mr Forrest had made the attempted purchase on an "all or nothing" basis, a move that Tim Schroeders from the Pengana Global Resources Fund said may have been designed to learn "what overhang is sitting on the market". Page 17.

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Observers yesterday suggested that global miner BHP Billiton could emulate a move from iron ore producer Fortescue Metals Group by attempting to expand capacity from the inner harbour at Port Hedland in Western Australia, in a bid to postpone the expensive construction of an outer harbour. Glyn Lawcock, analyst at investment bank UBS, yesterday said BHP could achieve a 27 percent internal rate of return if it spent US${esc.dollar}2 billion on increasing iron ore exports from the inner harbour by 25 million tonnes. Page 17.

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

The chief executive of Fairfax Media, Greg Hywood, yesterday made his first public comments regarding billionaire Gina Rinehart's bid to secure a seat on the media conglomerate's board, saying that she must honour the company's charter of editorial independence if she wants to become a director. "Editorial independence is actually a bedrock of what makes this company what it is. It works as a promise to readers that what we put out doesn't deliver sectional or personal interests to people," Mr Hywood said. Page 19.

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Analysts yesterday said that shares in News Corporation were likely to undergo a substantial correction if the media conglomerate pursues a strategy to separate its entertainment and publishing businesses. News is reportedly looking at splitting its education, newspapers and book publishing assets from its television and film companies, which includes the Fox News channel, the Fox broadcast network and the 20th Century Fox movie studio. Page 19.

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Shares in Seven West Media slumped by 13.7 percent after the media company shocked the market with the appointment of former oil and gas veteran Don Voelte as chief executive following David Leckie's departure. Mr Voelte insisted he was the right man for the position, saying that his skills gained in the resources industry were easily transferable to the media sector. "The basic skills of decision-making, the process leading up to decision-making, risk management and things like that are the same," he said. Page 19.

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One of the board members of Seven West Media, Peter Gammell, yesterday criticised traders for short-selling the media conglomerate's stock after its shares plunged by nearly 14 percent following the appointment of Don Voelte, former chief executive of oil and gas producer Woodside Petroleum, as chief executive. Mr Gammell also rejected rumours that the company would risk breaching its loan covenants if its share price continued to fall, describing the speculation as "complete garbage". Page 19.

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

The S&P/ASX 200 Index yesterday fell 0.4 percent to close at 4013.3 points yesterday after investors' mood was soured by the news that Cyprus had become the fifth member of the euro zone to request financial assistance. The resources sector had a difficult day's trading, following a declaration from the commerce ministry of China that said the Asian nation's trade growth was on the rise. Richard Herring, director at Burrell Stockbroking, said more shareholders felt "the glory days have passed" for the major miners. Page B1.

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A new report published yesterday by financial services firm GE Capital found that the medium-size business sector is more confident than its large and small-sized counterparts. The study, which surveyed more than 5000 chief financial officers, recorded its largest rise in nearly two years, which observers say was buoyed by positive results for mining-exposed companies. "They're having much friendlier conversations with landlords than they were say three years ago," Skander Malcolm, chief executive of General Electric in Australia, said. Page B2.

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John Price, commissioner of the Australian Securities and Investments Commission, yesterday said that the corporate regulator would "not hesitate to take action if needed to maintain investor confidence and enhance market efficiency". The warning came as the body continues to monitor financial reports filed this year for auditors and companies that overstate their assets and earnings. Page B3.

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Myer yesterday announced it would establish a two-level 12,000 square metre outlet in Darwin, becoming the Northern Territory's first full-line luxury department store. "As we optimise our store network across the country, Darwin is the ideal location for a new store, and will expand our customer base and footprint into the Northern Territory for the first time," chief executive Bernie Brookes said. Page B3.

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THE AGE (www.theage.com.au)

Tim Jordan, analyst at diversified financial services firm Deutsche Bank, yesterday said that there was "a very real chance" that the Federal Government's carbon price could be "pretty low" by 2015, reducing the incentive for businesses to invest in green schemes. Seb Henbest, the local manager of Bloomberg New Energy Finance, yesterday said it would be unacceptable to the government or companies if Australia's carbon price fell to a few dollars per tonne when the scheme is allowed to float freely from 2019. Page B5.

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Global financial services firm Deloitte yesterday asked in the New South Wales Supreme Court how it could best divide up the available funds recovered from the collapse of international contracts for difference provider MF Global. Fabian Gleeson, SC, representing Deloitte, said the liquidator had been able to source A${esc.dollar}82 million of the A${esc.dollar}167 million owed, while the firm had A${esc.dollar}150 million held in accounts when it went into administration late last year. Page B6.

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Chinese conglomerate Bright Food has acquired a controlling stake in the DIVA Bordeaux wine distribution company through a subsidiary. The acquisition comes as rumours circulate that the Chinese firm is considering making a play for Treasury Wine Estates, the second largest wine maker in Australia. David Williams, a director at investment bank Kidder Williams, yesterday said there were several Chinese corporations "meandering around Australia looking at very large assets". Page B6.

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Guy Debelle, assistant governor of the Reserve Bank of Australia, yesterday said that the only evidence of oversupply in Australia's housing market was in Queensland. "Nationally the level of housing construction is about where it was 10 years ago, but the population is 15 percent higher," Dr Debelle said in an address to a mortgage forum in South Australia. Page B8.