PRESS DIGEST: Australian Business News : June 2
07:15, Friday, 2 June 2006
(Compiled for Reuters by Media Monitors)
THE AUSTRALIAN FINANCIAL REVIEW (www.afr.com)
Perth-based utility, Alinta, has agreed to pay
Australian Gas LightA$45 million if a deal to merge
their infrastructure assets falls through. The break fee,
designed to reduce the chance of a counterbid for Alinta from
another party, is understood to be among the details of a merger
implementation agreement signed by the two companies yesterday.
It comes after Babc ock & Brown managing director, Phil Green,
reported last Friday that the investment bank had bought two per
cent of Alinta's shares. Page 67.
- - - -
Chinese steel mills have sidelined Brazil's Companhia Vale do
Rio Doce (CVRD)in iron ore negotiations, turning to
Australian producers, BHP Billitonand Rio Tinto , in a bid to escape a 19 per cent price rise agreed to
by Japanese and European steel mills. China Industry Daily News
said on Wednesday: 'Given that CVRD will continue to exert
pressure on China, China is expected to suspend its long-term
contract with CVRD...Australian suppliers will gradually replace
CVRD in the Chinese market.' CVRD yesterday denied it had been
excluded from price talks. Page 67. - - - -
Logistics group, Brambles Industries, has appointed
two executives from leading British alcohol companies to its
board, which is chaired by Don Argus. The Australian- and United
Kingdom-listed company has hired Diageo senior executive, David
Gosnell, and Scottish & Newcastle chief executive, Tony Froggatt,
as non-executive directors. Mr Argus, who also chairs BHP
Billiton, said identifying and appointing people whose experience
could benefit Brambles' global operations was important. Page
67.
- - - -
United States railway company, Genesee & Wyoming
(G&W), will target resources projects for growth after finalising
the A$1.3 billion sale of Australian Railroad Group (ARG) to
Queensland Rail and Babc ock & Brownyesterday. The sale
does not include the South Australian operations of ARG, which
will revert to G&W ownership. The manager of newly created G&W
Australia, Bert Easthope, said the company may seek an interest
in the proposed A$6 billion expansion of BHP Billiton's Olympic
Dam copper-uranium-gold mine. Page 68.
- - - -
THE AUSTRALIAN (www.theaustralian.news.com.au)
Tabcorpyesterday launched a A$1.9 billion takeover
bid for Unitab, trumping an offer from Victorian gaming rival,
Tattersall's Group. The move highlights Tabcorp's aim
to consolidate Australia's three betting pools into one super
pool. The shares or cash-and-shares offer values
Queensland-based Unitab, the nation's second-largest wagering
company, at A$14.25 a share. This exceeds Tattersall's scrip bid
of A$12.51 a share or A$12.93 a share under its cash alternative
offer, based on yesterday's closing prices. Page 19.
- - - -
Higher costs for materials and labour as a result of the
commodities boom have forced BHP Billiton to delay its planned
A$900 million expansion of the Worsley alumina refinery south of
Perth. Company spokesman, Mick Wheeler, last night confirmed
that BHP would continue to study the feasibility of the project
by investigating how to cut costs. 'We have not scr apped the
project,' Mr Wheeler said. Construction work on the Worsley
expansion had been expected to begin before the end of the year.
Page 19.
- - - -
Telecom New Zealand(TNZ) may be looming as a
takeover target for local billionaire, Graeme Hart, after losing
one-third of its market value in the past six months. Mr Hart's
Australian foods business, Burns Philp, has cash
reserves of A$2.5 billion, and press reports say he is examining
TNZ's accounts. TNZ this week appointed lawyer and investment
banker, Wayne Boyd, to replace retiring chairman, Roderick Deane.
Mr Boyd immediately gave support to TNZ chief executive, Theresa
Guttung, and her 'very able management team.' Page 21.
- - - -
Macquarie Bankis finalising a funding package to
rescue Eurotunnel, the operator of the Channel Tunnel
linking Britain and France. The plan would allow Eurotunnel to
slash its debt from £6.2 billion (A$15.4 billion) to £2.9
billion, with a group of investors led by Goldman Sachs and two
Macquarie funds investing in A$1 billion hybrid notes. At least
two of Eurotunnel's creditors, Oaktree Capital Management and
Franklin Mutual Advisors, have said they would also invest in the
hybrids. Page 21.
- - - -
THE SYDNEY MORNING HERALD (www.smh.com.au)
Australian business investment is growing at a faster pace
than in China, according to the Australian Bureau of Statistics.
Figures released yesterday show a 29 per cent rise in capital
spending in Australia over the past year, compared with 28 per
cent in China. However, the Chinese economy continues to expand
more than three times the rate of Australia's. 'The strength of
our business investment is offset by the weakness of our growth
in export volumes and the downturn in housing construction,'
explained HSBC chief economist, John Edwards. Page 21.
- - - -
The Australian dollar fell US1.5 cents yesterday as United
States (US) currency surged on expectations of another interest
rate rise. Amid a sharp fall in the price of gold, the
Australian dollar closed at US74.83 cents in local trading, down
on Wednesday's close of US76.39 cents. Westpac chief currency
strategist, Robert Rennie, cited minutes from the US Federal Open
Market Committee's May 10 meeting signalling another rise in
rates. 'We've had to address that, so the US dollar has done
better,' he said. Page 22.
- - - -
Multiplex Grouphas delayed by a fortnight the date
by which it expects to finish its Wembley Stadium reconstruction
in London. Multiplex said yesterday the new A$1 billion sporting
arena would be 'substantially complete' by July 13, instead of
the end of June. In February, Multiplex reported a first-half
loss of A$120 million, caused by extensive delays to the project.
These included a dispute with the former steel contractor on
Wembley, Cleveland Bridge, which abandoned work on the stadium's
feature arch in August 2004. Page 23.
- - - -
Online wagering and gaming company, Centrebet, seeks to raise
A$70 million through a public offering before listing on the
Australian Stock Exchange in mid-July. The company, owned by
Sydney's Kafataris family, is offering investors 35.11 million
shares at A$2 each. The family bought the Alice Springs-based
Centrebet from Jupiters Casino in 2003 for A$46.5 million.
Centrebet, which generates 70 per cent of its revenue from
sports betting, expects to have a market capitalisation of A$174
million on listing. Page 23.
- - - -
THE AGE (www.theage.com.au)
The Australian Securities and Investments Commission (ASIC)
is investigating claims that local companies are using hedging
schemes to boost their executive options. The schemes allegedly
allow executives to sell or hedge their options during the
vesting period without informing shareholders. ASIC deputy
chairman, Jeremy Cooper, revealed yesterday he had discussed the
issue with the Australian Council of Superannuation Investors,
which had already written to the top 200-listed companies asking
whether they were engaging in the practice. Page B1.
- - - -
Accountancy firm, KPMG, has denied any responsibility for the
collapse of property financier, Westpoint Group, as the
Australian Securities and Investments Commission investigates an
audit by the firm endorsing Westpoint's finances just before its
demise in January. KPMG Australian chief executive, Lindsay
Maxsted, said yesterday various groups were keen to apportion
blame for A$300 million in losses resulting from the collapse.
'Many of the claimants are in no position to form a view on the
quality of KPMG's audit,' he said. Page B1.
- - - -
The Australian stockmarket received a lift yesterday on the
back of the resources sector and a positive lead from Wall
Street. The benchmark S&P/ASX200 Index closed 58.9 points higher
at 5060.6, helped by a A42 cents rise for BHP Billiton to A$28.65
a share, and Rio Tinto's A$1.46 gain to $79.56. 'The market has
kicked off the first day of the month on a positive note, making
it over the 5000 [points] mark,' reported Macquarie Equities
adviser, Helen Spencer. Page B2.
- - - -
The average size of new mortgages in Australia has jumped to
more than A$300,000, driven by the booming West Australian
property market, according to a new survey. The AFG Mortgage
Index for May found that the average new mortgage was A$301,000,
an increase of 11 per cent from a year ago. In Western
Australia, the average new mortgage has risen by 35 per cent in
the past year to A$319,000. AFG executive director, Kevin
Matthews, warned 'we should treat the [results] with some
caution,' as AFG was 'tilted to the upper end of the market.'
Page B2.
--
Looking for more information from local sources? Factiva.com
has 112 Australian sources including the Australian Financial
Review.
((Reuters Sydney Newsroom, 61-2 9373 1800,
[email protected]))
Keywords: DIGEST AUSTRALIA BUSINESS
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