business speculator.. wheels and deals

Wheels & Deals
6:01 PM, 23 Oct 2008



Giles Parkinson

Macquarie in the doldrums

Macquarie Group has no doubt wished for better weeks, what with the galling prospect of former client GPT tapping the markets for one of the biggest equity issues of the year – with the help of three of its biggest rivals.

Macquarie had been the advisor for GPT when it snubbed a $7.6 billion offer from Stockland that valued its stock at $3.70. Now UBS, the advisor to Stockland in that 2004 proposal, is lining up for GPT, collecting up to $33.5 million in fees as advisor and co-manager and underwriter to its near $1.9 billion offering – at between 60c and 75c a share.


This has not been the first “what-if-we-accepted-that-offer-back-then” proposal of the last week. Macquarie was also the advisor to FKP earlier this year when it snubbed an offer from Lend Lease at more than $5 a share, but at least it retains a mandate as FKP welcomes a UBS-advised Stockland on board in a $150 million capital raising announced a week ago.

Macquarie has also had to watch as the markets did damage to other key mandates. Donaldson Coal has postponed plans for a $1 billion IPO, to be managed by Macquarie, and Aquila Resources has done the same to the demerger of its exploration assets, and the search for strategic buyer of its coal assets, which Macquarie had been mandated to manage along with Citi.

Last month, Macquarie’s Singapore office had to watch as Straits Resources abandoned plans to demerge its coal assets – a decision that cost the office $3.5 million in lost fees. And there is now doubt that the mooted $5 billion IPO of Clive Palmer’s Resource Development International, which has retained Macquarie Group and UBS, will go ahead in the current market climate.