PRESS DIGEST-Australian Business News - Aug 18 07:10, Monday, 18 August 2003
(Compiled for Reuters by Media Monitors) THE AUSTRALIAN FINANCIAL REVIEW
Expectations are emerging that the West Australian government will give its approval to the proposed A$11 billion Gorgon project, despite concerns about the possible environmental impact of the creation of the liquefied natural gas development on Barrow Island. A formal government decision will be made on the project, which is operated by oil and gas group, ChevronTexaco , at the September 1 State Cabinet meeting. Page 1.
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GS Private Equity and Quadrant have put Tasman Building Products up for sale, with sources close to the trade sale predicting that New Zealand-based group, Fletcher Building Ltd , is the frontrunner in the sale. A formal announcement on the conclusion of the sale, which Deutsche Bank is advising on, is expected to be made within the next few days. Page 14.
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Expectations are centring on wagering group UNiTAB Ltd announcing a 60 percent increase in full-year net profit as a result of the benefits gained from an increase in betting, as well as the integration of the South Australian TAB, which was acquired two years ago. Speculation rests on UNiTAB recording a profit of A$40.9 million for the 12 months ending June 2003, which was based on a survey by Thomson One Analytics. Page 14.
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The Australian Fruit Juice Association (AFJA) has launched an investigation into allegations of the adulteration of pure fruit juice products by an undisclosed fruit juice manufacturer, following claims by Brisbane's Golden Circle at the recent technical meeting of AFJA's industry compliance committee. Sources claim that the investigation could hamper Coca-Cola Amatil's negotiations to purchase fruit juice manufacturer, Berri, for between A$300 million and A$400 million. Page 15.
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The Australian Shareholders Association (ASA), in conjunction with the Investment and Financial Services Association, has informed listed electronic components manufacturer, HarTec, of its strong opposition to its proposal to provide non-executive directors with share options. The ASA highlighted the Australian Stock Exchange's principles on corporate governance, stating that options or bonus payments should not be given to non-executive directors. Page 16.
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THE AUSTRALIAN
BHP Billiton Ltd's petroleum division is preparing to undertake the most extensive exploratory drilling programme in the past decade, with the exploration in the Bass Strait and North West Shelf aimed at discovering replacement reserves for the declining production rates in two of BHP's significant revenue sources. Page 27.
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Dandaragan Estate, which is owned by dedicated Australian olive oil producer, Olea Australis, is expected to produce as much as 2000 tonnes of olive oil per year via a A$1.5 million processing facility located in Western Australia's Moore River region. Estate chief executive, Geoff Newing, said that Australia would produce almost 1 per cent of global olive oil with the 385-hectare, A$15 million olive grove. Page 27.
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Analysts say the expected announcement by AMP Ltd Chief Executive, Andrew Mohl, this week of net losses worth approximately A$2.3 billion would not be a surprise to the market, despite a consensus that investors and analysts will not accept any future deterioration in AMP's British-based assets or another capital raising. AMP is to announce its half-year results on Wednesday, which will show the full extent of its recent spate of asset writedowns. Page 29.
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Pay television group, Foxtel, is believed to have applied to the Australian Competition and Consumer Commission for clearance under its third-line forcing provisions to be permitted to undertake the retransmission of free-to-air TV channels on its new digital Foxtel system. Seven Network Ltd and Ten Network Holdings Ltd claim Foxtel's third-line forcing would demand that free-to-air stations purchase satellite capacity from Optus Ltd prior to retransmission, and have called on Foxtel to cover the predicted A$5 million annual cost. Page 29.
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THE SYDNEY MORNING HERALD
Qantas Airways Ltd is believed to be considering the viability of establishing a low-cost operation hub in Singapore in the lead-up to the September 22 resumption of negotiations between the Australian and Singaporean governments on an open skies agreement. Qantas and major shareholder, British Airways Plc , already hold 'seventh freedom' rights to create bases in Singapore. Page 31.
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The Commonwealth Bank of Australia Ltd is to announce its full-year results on Wednesday, providing investors with an indication of the performance of the nation's major banks. This week will also see Deutsche Office Trust, Cochlear Ltd , Qantas Airways Ltd and Woodside Petroleum Ltd report their financial performance. Page 32.
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An unsourced report in London's Sunday Times said that mining giant, BHP Billiton Ltd , is planning to launch an offer for AES Drax Holdings later this week in order to gain a new market for its coal operations. Drax, the United Kingdom's largest power plant, has been seeking a buyer for a portion of its A$2.1 billion worth of debt since major customer, TXU Europe, was placed into administration last year. Page 32.
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Analysts are remaining cautious about the future performance of retail giant, Coles Myer Ltd , despite investors having forced its share price higher during sharemarket trading on Friday following a promise of higher profits and the announcement of better-than-expected sales results. Credit Suisse First Boston has remained cautious due to the view that Coles' retail petrol deal with oil refiner Shell was 'a potential gamble.' Page 33.
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THE AGE
Federal senator George Brandis has confirmed that the government will introduce measures contained in draft legislation on corporate law reform that would see chief executives and chief financial officers compelled to certify the accuracy of company financial statements. The draft Corporate Law Economic Reform Program 9 legislation will also include measures to rotate the lead engagement and review partners of audit firms every five years. Page B1.
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The former directors of insurance group, GIO, are expected to pay a predicted A$20 million in compensation if the federal court grants approval to the largest shareholder class action in Australia. A number of former high-profile GIO directors are expected to claim on directors and officers insurance, written across a number of other insurance companies led by American Home Assurance (AHA). AHA parent group, American International Group, last week declined to disclose information on whether it had provided indemnity insurance to GIO. Page B1.
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Australian food manufacturer, Burns Philp , has announced that A$50 million in cost savings had been identified as a result of the recent takeover of Goodman Fielder , with expectations that analysts and investors will want more information later this week. Burns Philp is among a number of Australian companies to report results this week. Page B2.
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Australian stockbrokers, Intersuisse and the Sequence Capital Group, have joined with Bioscience Managers head, Jeremy Curnock Cook, to raise a A$150 million fund in an effort to stimulate consolidation and attract international funding for the Australian biotechnology sector. Page B3.
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Speculation is mounting that Malaysian group, Genting Bhd , may make another bid for Loy Yang Power, two months after it shelved its bid following criticism by Prime Minister Mahathir Mohamad, over Australia's stance on the war on Iraq. Genting is believed to have made representations to the Australian Competition and Consumer Commission regarding Australian Gas Light's A$3.5 billion bid for Loy Yang. Page B4. --
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