PRESS DIGEST-Australian Business News - Jan 31 07:08, Monday, 31 January 2005
(Compiled for Reuters by Media Monitors) THE AUSTRALIAN FINANCIAL REVIEW (www.afr.com.au)
CanWest Global Communications Corp. of Canada, the controlling shareholder in Australian television broadcaster, Ten Network says that Ten will be "very definitely" a buyer of media assets in any shakeup of the Australian industry. CanWest executive vice-president, Peter Viner, also said that CanWest saw its 57.5 percent shareholding in Ten as a long-term investment, despite recent speculation that it was looking for a buyer. Page 13.
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An internal investigation of price-fixing allegations at packaging group, Visy Industries, has included the company's billionaire founder, Richard Pratt, sources have told The Australian Financial Review. The internal investigators are being assisted by law firm, Blake Dawson Waldron, and the inquiries, now in their third month, are not expected to be completed until late February or March. Visy continues to deny any knowledge of price-fixing by its employees. Page 13.
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Opinion is divided in the A$73 billion ($56 billion) tourism industry about the likely impact of Patrick Corporation's bid for full control of airline, Virgin Blue Ltd. David Mazitelli, chairman of the Australian Tourism Export Council, said the bid could exacerbate the current discount war in domestic air travel. Some travel agents said the bid illustrated that Virgin had been forced into a "no-man's land, where it was not quite full service or low-cost." Page 15.
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National Australia Bank Ltd is bracing for one of the corporate year's most divisive shareholder meetings today, with the board facing demands for details of proposed restructuring and capital management. NAB was the worst-performing Australian bank in 2004, delivering total returns of 1.8 per cent, under-performing its sector by 15 per cent and the overall market by 26.4 per cent after its currency trading scandal a year ago. Page 43.
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THE AUSTRALIAN (www.theaustralian.news.com.au)
British entrepreneur, Sir Richard Branson, says the Patrick Corporation bid for a greater shareholding in airline, Virgin Blue, is too low. Sir Richard's Virgin Group bought 5.1 million Virgin Blue shares on Friday at an average price of A$2.04 after Patrick announced its offer of A$1.90 a share. The purchase took Virgin Group's stake to 25.1 percent, compared with Patrick's 45.95 percent. Virgin Blue's share price rose 16 percent on Friday to close at A$2.08. Page 27.
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Prime Minister, John Howard, said at the weekend he had always accepted arguments for a role for uranium in the world energy picture. At the World Economic Forum in Davos, Switzerland, Mr Howard, said he was 'interested' to note the renewed emphasis being placed on hydro and nuclear power "after all these years." He said the Coalition had always had an open mind on nuclear energy and he regarded Australia's uranium reserves as an "extremely valuable resource." Page 27.
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Many analysts are forecasting that the interim profit reporting season, about to start, could produce the strongest results in a decade, with many companies exceeding their own estimates. "The stars have really aligned in a favourable way," said Commonwealth Securities senior equities strategist, Charles Hyde. A JP Morgan research note yesterday said the number of earnings revisions by analysts in the past six months was the highest for 15 years. Page 28.
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The Australian Securities & Investments Commission (ASIC) confirmed yesterday that it was investigating allegations that a senior executive of beverage company, Foster's Group Ltd. sold Foster's shares ahead of news of its bid for wine producer, Southcorp . Foster's revealed last week that its head of investor relations, Robert Porter, has resigned over "what may have been an inadvertent breach" of company guidelines on employee share trading. Page 29.
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Australian companies, Woodside Petroleum Ltd and Oil Search Ltd. have won shares in the new oil exploration campaign being promoted by the Government of Libya. Woodside, in partnership with Occidental Petroleum of the United States, and Liwa Energy, owned by the Abu Dhabi Government, has won four exploration blocks. Oil Search, bidding with Petrobas, of Brazil, was awarded one block. Page 29.
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THE SYDNEY MORNING HERALD (www.smh.com.au)
For the second successive year, Sydney's Autumn Racing Carnival faces a television blackout after a series of apparently inconclusive meetings last week between the metropolitan race clubs and broadcaster, Sky Channel, now owned by Melbourne-based Tabcorp. Tabcorp Holdigs Ltd. says that broadcasting is unlikely to continue beyond Sunday unless a new contract is agreed. Australian Jockey Club spokesman, Jeremy Wilshire, said yesterday the clubs were prepared to go their own way. Page 33.
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Hearing implant maker, Cochlear and its competitors in the China market were prevented from importing their products for three months late last year because of a Chinese Government investigation of alleged tax fraud associated with a research centre for deaf children. The incident was revealed in a Citigroup Smith Barney research report, which said Cochlear was not involved in the allegations and resumed imports two weeks ago. Cochlear chief executive, Chris Roberts, said yesterday the report was "not hugely off the mark." Page 34.
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Singapore Airlines has dismissed speculation that it might involve itself in Patrick Corp's A$1.1 billion ($847 million) bid for Australian airline, Virgin Blue. Singapore Airlines spokeswoman, Samantha Stewart, said yesterday the bid was "an interesting development," but "at this stage, Singapore has no intention or no plans to purchase any part of Virgin Blue." A report in the London Daily Telegraph said Patrick held talks with Singapore Airlines before making its bid. Page 34.
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THE AGE (www.theage.com.au)
On his last day as Victoria's Minister for Manufacturing, Tim Holding warned manufacturers on Friday that they might not survive unless they embraced a culture of exporting. He said companies producing just for the domestic market would struggle to reach the scale needed to give a cost structure enabling them to compete with foreign manufacturers. Mr Holding was promoted to Minister for Police and Emergency Services in last week's Cabinet reshuffle. Page 10.
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Australian agriculture has rebounded strongly from the drought, with the value of production in 2003-04 rising by 12 percent to A$36.6 billion ($28.2 billon), according to latest data from the Australian Bureau of Statistics. The recovery in cropping was dramatic in many regions, but livestock slaughterings increased only slightly as farmers rebuilt herds and flocks. Wheat output rose by 112 percent to A$5.7 billion. Page 12.
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Victorian aquaculture producers say the industry is in crisis because of the State Government's policy of cost recovery through licence fees. Yabby, fish and crustacean producers had their licence fees increased by more than 400 percent last year, representing between A$250 ($192) and A$2000 per licence. Fees are set to rise further in the next two years and the number of licences on issue has fallen from 300 to 100, according to the Victorian Aquaculture Council. Page 12.
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Swiss-based mining group, Xstrata Ltd is warning investors that it is prepared to walk away from its A$7.4 billion ($5.7 billion) takeover offer for WMC Resources Ltd. . In a briefing published on its website, Xstrata says it will "not provide an indefinite underwrite of WMC's share price" and will be seeking a 'decision' from WMC shareholders. WMC shares closed on Friday at A$7.20, giving the company a valuation A$1 billion higher than Xstrata's offer. Page 14. --
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