PRESS DIGEST-Australian Business News - Feb 3 06:53, Friday, February 03, 2006
(Compiled for Reuters by Media Monitors) THE AUSTRALIAN FINANCIAL REVIEW (www.afr.com)
Alinta chief executive, Bob Browning, yesterday criticised rival energy group, Australian Gas Light , for rejecting an A$11 billion merger proposal he put to AGL in November. Mr Browning said he had approached AGL with an A$18-a-share proposal after AGL revealed demerger plans in October. In recent weeks, Alinta had also approached major AGL shareholders in an unsuccessful attempt to garner a 10 percent stake in the company. Page 88.
--
The downturn in the A$2.8 billion capital city television advertising market is creating problems for Nine Network as it sells advertising in its coverage of the Melbourne Commonwealth Games, say media buyers. While Nine Network has sold 10 sponsorships of the March Games, media buyers claim the soft state of the advertising market means Nine will struggle to meet its target for 'casual' advertisements - those that are not part of sponsorship deals. Page 89.
--
Airport, road and ports investor, Australian Infrastructure Fund , plans to ramp up its debt levels buying newly developed toll roads in North America and Europe. Recently appointed chief operating officer, Peter McGregor, said yesterday AIF's gearing of 40 percent was too conservative when historically low borrowing costs were making debt cheaper than equity. The refinancing of Queensland Airports in July underpinned a doubling in AIF's gross cash-flow to A$36.9 million for the six months to December. Page 90.
--
Australian Competition and Consumer Commission chairman, Graeme Samuel, said yesterday it might not be worth the regulator taking Toll Holdings to court to block its A$4.6 billion takeover bid for Patrick Corp , because he was not convinced the bid had any chance of success. 'Before we go to court we need to know that there is either a live bid or that Toll intends to re-launch its bid for Patrick in the future,' Mr Samuel said. Toll chief executive, Paul Little, said Mr Samuel was engaging in delaying tactics. 'The bid will be extended,' Mr Little said. Page 90.
--
Analysts are reviewing the earnings potential of Coca-Cola Amatil's consumer foods division following a site tour of SPC Ardmona's manufacturing facilities in Victoria. The tour, conducted a week before the release of Coca-Cola Amatil's full-year results, highlighted the need for 'significant capital investment' at SPC. Coca-Cola, which acquired SPC 12 months ago after launching a A$524 million bid, has flagged plans to invest A$115 million over the next three years in the fruit and vegetable processor. Page 91.
--
THE AUSTRALIAN (www.theaustralian.news.com.au)
After reaching record levels earlier in the day, benchmark indices on the Australian Stock Exchange plunged about 1.5 per cent in two hours, creating minor panic on trading floors. The S&P/ASX200 Index <.AXJO>, which was up more than 20 points at one stage, closed down 51.6 points. Heaviest hit were shares in the major banks, following the release of poor construction figures showing building approvals for December fell 3.5 per cent. ABN Amro yesterday joined other analysts in suggesting the stockmarket was overvalued at present. Page 19.
--
West Australian Newspapers Holdings yesterday warned of a slowdown in advertising revenue growth, after one-off costs dragged the publishing and cinemas group to a 50 per cent drop in first-half profits. Despite WAN's West Australian newspaper reporting a 5.2 percent rise in advertising revenues for the six months to December, WAN chief executive, Ian Law, saw 'little prospect of a positive change in the market,' saying real estate advertising revenues would be suppressed by a shortage of saleable and rental properties. Page 21.
--
The shareprice of Childs Family Kindergartens soared 16.5 per cent yesterday, following the announcement of a Macquarie Bank proposal to acquire a A$10.9 million stake in the childcare provider. Macquarie will buy 30 per cent of the company through a placement of stock via two tranches. Childcare is a growth industry, with Brisbane-based ABC Learning one of the best-performing stocks last year. Childs Family Kindergarten's shareprice closed A7 cents higher at A49.5 cents. Page 21.
--
THE SYDNEY MORNING HERALD (www.smh.com.au) Multiplex Group has warned the British Football Association it will be forced to pass on some of the soaring costs of the Wembley Stadium redevelopment. It comes after revelations the firm's budget overruns on its contract could stretch beyond A$352.7 million. Reportedly, the steel cost for the project will be 90 million pounds more than originally budgeted, with the original steel contractor, Cleveland Bridge, pulling out after a series of disputes that are now the subject of a court case. Page 19
--
Mining conglomerate, Rio Tinto , last night exceeded investor expectations with a A$5.3 billion (US$4 billion) capital management program after reporting record full-year earnings. 'It is absolutely enormous,' ABN Amro analyst, Rob Clifford, said of the US$2.5 billion share buyback over two years and US$1.5 billion special dividend to be paid to shareholders in April. Page 19.
--
Telecom New Zealand has reported a A$424.3 million loss for the first half of 2005-06, after slashing the value of troubled Australian subsidiary, AAPT. In a move flagged last month, Telecom NZ has made a write-down of A$836 million in the carrying value of the Australian business to A$628 million. While considering selling or merging AAPT, Telecom NZ said it had received no firm offers to date. Page 19.
--
THE AGE (www.theage.com.au)
Anglo-Australian miner, Rio Tinto, will return more than A$5.53 billion (US$4 billion) to shareholders after surging commodity prices more than doubled the group's profit and increased cash flows to US$8.26 billion. Profit was up 58 per cent to A$5.22 billion, with a final dividend of A$1.06 (US80 cents) reflecting 'a very good year for Rio,' according to chairman, Paul Skinner. In addition, shareholders will receive US$1.10 per share as a special dividend. Page B1.
--
Following his father's death in December, Publishing and Broadcasting Ltd chairman, James Packer, is now the richest man in Australia, according to Forbes Asia magazine. An estimated fortune of A$6.9 billion was inherited by Mr Packer, 38, when Kerry Packer passed away due to kidney failure. James is also the youngest to appear on the list of the 40 richest individuals in Australia and New Zealand, released yesterday. PBL owns television broadcaster, Nine Network, and Melbourne's Crown Casino. Page B1.
--
Australian Bureau of Statistics retail trade figures, due today, are expected to show only a small lift in sales over the Christmas period. Most market analysts expect sales growth of between 0.2 and 0.5 per cent in December, and flat or negative growth for the final quarter of 2005. Commonwealth Securities chief economist, Craig James, said Christmas produced a mixed bag of sales results. Page B2.
--
The Finance Sector Union (FSU) has urged employees of National Australia Bank to bring forward a vote on a new enterprise bargaining agreement (EBA) to ensure it is implemented before changes to industrial relations laws take effect on March 1. FSU spokesman, Rod Masson, said the agreement broke new ground by structuring share allocations to employees within their EBA. It also entrenched the union's position in the bank for the duration of its three-year term before the Federal Government's WorkChoices legislation comes into effect. Page B2. --
Looking for more information from local sources? Factiva.com has 112 Australian sources including the Australian Financial Review.
