AUST today (extract):
HARDIE’S SHIFT TO A PRIMARY US LISTING COULD OPEN THE DOOR FOR WOODSIDE AND BLUESCOPE TO FOLLOW
James Hardie’s move to a primary listing in the US has revived the debate about where the future lies for a number of Australian stocks, including the country’s oil and gas champion, the $44bn Woodside Energy.
There’s a view around the market that Hardie’s $14bn buyout offer for Chicago-based Azek was motivated by its desire to have its main stock exchange listing in the US where it generates about three quarters of its sales and where it sees growth opportunities. It came just months after Amcor made a shift to the US with its $13bn acquisition of Berry Global Group in December. But market experts say they are not the only ones.
Next could be steel manufacturer BlueScope, which derives the bulk of its earnings out of the US, scrap metals company Sims, and defence ship builder Austal, which counts the US as its main revenue earner.
Industrial stocks in particular see the merits of concentrating more on the US, where there’s better opportunities for expansion, a more friendly regime for manufacturing and cheaper energy costs.
One of the more contentious movers could be Woodside, which has been expanding in the US market with acquisitions. It comes as speculation continues to surface about buyout interest from major US energy players, including ConocoPhillips and Chevron. British energy giant BP was also said to be taking a look. The understanding is that the trio have been eyeing Woodside over the past year, but none have embarked on any serious work for a buyout yet with risks that a deal would be blocked by the Australian government.
The federal government did just that years back when Shell tried to buy Woodside. At that time, Woodside was strongly opposed to the proposal. This time, if it was a friendly deal with the Meg O’Neill-led Woodside, it could be a different story. The company in recent years has faced opposition from anti-fossil fuel activists in Australia, and some of its shareholders have been vocal about their opposition to producing oil and gas.
One way Woodside could distance itself from the Australian market, should it opt to do so, is to focus more on US-related opportunities in a way similar to James Hardie’s latest deal. This could be where it involved itself in an acquisition or merger of a US group, which could justify a listing in the US and eventually distance itself from the Australian market.
The discussion coincides with a growing frustration among company directors and management teams over the onerous ASX rules for corporate governance and the power of proxy advisers.
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