PRESS DIGEST: Australian Business News: Sept. 22 06:53, Friday, 22 September 2006
(Compiled for Reuters by Media Monitors)
THE AUSTRALIAN FINANCIAL REVIEW (www.afr.com)
Mayne Pharma yesterday received a higher-than-expected A$2.6 billion takeover offer from United States industry giant, Hospira, which has been conducting due diligence on the cancer-drug manufacturer over the past week. The A$4.10-a-share bid is a substantial premium to Mayne's closing shareprice before a trading halt earlier in the week. Nevertheless, analysts have not ruled out the possibility of a counter-bid, given Mayne's portfolio of specialist drugs and access to European and North American markets. Page 58.
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Visy Industries will use a court statement by former Amcor executive, James Hodgson, to corroborate its defence against a cartel prosecution by the Australian Competition and Consumer Commission. Mr Hodgson, who is suing Amcor for unfair dismissal, claims Visy tendered below price floors in the corrugated box market to steal customers from its rival. According to Visy, this proves its case that the alleged cartel was actually a price war between the two companies. It may also call Mr Hodgson as witness. Page 58.
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The proposed sale of Primary Health Care's pathology business to Symbion Health is in doubt, after negotiations broke down over price. It is understood Symbion baulked at the A$425 million asking price for SDS Pathology, offering A$300 million. In a statement to the Australian Stock Exchange last night, Primary said such a sale would have led to a reduction in the synergies management had built. SDS has an 11 per cent market share in the New South Wales pathology sector, and 4.5 per cent nationally. Page 58.
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Australia's largest gaming group, Tabcorp Holdings , has not ruled out making an offer for New Zealand's Sky City Entertainment , whose shares soared almost three per cent yesterday on speculation of a bid. While Tabcorp was focused on improving its existing business, chief executive, Matthew Slatter, said 'we scan all the markets' for acquisitions. Sky City owns five casinos, including its flagship Auckland property, as well as operations in Adelaide and Darwin. It is worth an estimated A$1.9 billion. Page 59.
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THE AUSTRALIAN (www.theaustralian.news.com.au)
Leading financial advisory, Professional Investment Services, is being sued for placing its clients in failed West Australian property developer, Westpoint. Law firm, Slater & Gordon, is taking action on behalf of 22 investors who lost A$100,000 each when Westpoint collapsed in February. 'We believe there was misleading conduct by the advisers because they at no time appropriately disclosed that Westpoint was a high-risk product,' said Slater & Gordon director, Ken Fowlie. PIS said the group would 'vigorously defend' the action. Page 19.
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Mayne Pharma shares soared 35 per cent on resuming from a trading halt yesterday, as the board recommended a A$2.63 billion takeover bid from United States healthcare group, Hospira. Opening at A$3.10, Mayne's shareprice reached an intra-day high of A$4.26 before closing at A$4.16. Chairman, Peter Willcox, said a takeover by Hospira was subject to no superior offer being received. Mayne, which makes generic cancer treatments, recorded a A$31.34 million loss in 2005-06. It moved to Britain last year. Page 19.
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Macquarie Infrastructure Group chief executive, Stephen Allen, says 'less salubrious' Wall Street investment banks may try to incite resentment against foreign operators as they compete for United States toll-road opportunities. Mr Allen told an Australian investment conference in New York yesterday that xenophobia was 'alive and well in the US today.' In a A$5.1 billion joint venture with Spain's Cintra, MIG holds a 75-year lease on an Indiana toll-road in the state's north. It collects all toll revenues on the route. Page 21.
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SvitzerWijsmuller has effectively increased its offer for Australian tugboat operator, Adsteam Marine , to A$704 million by allowing shareholders to keep an interim cash dividend of 4.1 cents. The Danish shipping group launched a A$693 million friendly takeover for Adsteam at A$2.54 a share in July. With the dividend payout, the offer is now worth A$2.58 a share. The takeover is yet to be approved by British regulators, with the Office of Fair Trading concerned about a potential loss of competition at local ports. Page 21.
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THE SYDNEY MORNING HERALD (www.smh.com.au)
Business information provider, Baycorp Advantage , will re-launch itself as 'Veda Advantage' early next year. The new name, derived from a Sanskrit word meaning knowledge, follows the sale of Baycorp's debt collection agency to Trans-Tasman Collections in June. The cost of changing the brand is estimated at A$2-$3 million, with A$1 million already put aside from the proceeds of the Baycorp sale. Page 21.
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Amcor has denied knowledge of an impending A$6.6 billion offer for the packaging group, after the Australian Stock Exchange queried the company over the issue yesterday. Amcor shares surged A31 cents in early trade on speculation of a takeover, before the company declared it had not received a 'proposal indicating an intention to make a takeover bid.' However, sources reveal New Zealand billionaire, Graeme Hart, has indicated his interest in the Melbourne company. Page 21.
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Three Australian football codes have joined a push by pay-television (pay-TV) operators to reform the Federal Government's anti-siphoning regime, which gives free-to-air networks the first right to sporting events. The chief executives of the Australian Football League, National Rugby League and Football Federation Australia would rather negotiate directly with pay-TV for broadcast rights. Lobby group, Free TV Australia, which represents Channels Seven , Nine and Ten , criticised the move as a 'gang tackle' on Australian viewers. Page 21.
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News Ltd yesterday refuted Seven Network's claim that it conspired to 'kill' pay-television arm, C7, through winning the Australian Football League (AFL) broadcasting rights. News's barrister, Noel Hutley, SC, told the Federal Court there had been no stifling of competition when the AFL awarded the 2002-06 rights to a News Ltd consortium. Mr Hutley said Seven's assumption the AFL would treat C7 as 'a protected species' had led to the channel's demise. Page 21.
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THE AGE (www.theage.com.au)
United Kingdom-based consultancy, Blue Marlin Brand Design, has poached an executive from its main rival in Australia, Landor, to head its Melbourne business. Dominic Walsh, 37, assumed the role of Melbourne general manager this week. 'There's a huge continued demand for somebody who is very strong as a...strategic leader, and that's why we've put Dom in to play that role,' said Australian managing director, Brian Mansfield. Blue Marlin opened its first Australian branch in Melbourne in 1999. Page B2.
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Feltex Carpets is on the brink of collapse after negotiations with its banker, ANZ Banking Group , over a 'fully funded' rescue offer broke down. New Zealand's Turner brothers, owners of the Sleepyhead furniture group, have been locked in talks with ANZ for almost two weeks since making the offer. However, it is understood the deal only covers half of ANZ's outstanding debt of A$118 million. In a press release yesterday, the Turners claimed the delay 'is leading to the gradual demise of Feltex.' Page B3.
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A landmark ruling by the Victorian Civil and Administrative Tribunal has given BP Australia permission to target older workers for special recruitment. BP Australia subsidiary, Elite Solutions, applied for the exemptions from the Equal Opportunity Act to meet a skills shortage and reduce a 17 per cent workforce turnover rate. Elite runs a call centre and provides BP Australia with accounting and financial services. The exemptions will be in place for two years. Page B3.
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Economists have warned a recent drop in oil prices is only temporary, attributing the fall to 'seasonal weakness' at the year's end. Despite current prices of US$60 a barrel, Bell Commodities researcher, Peter Quinton, predicts an average price of US$68 for the full year. Mr Quinton highlighted a lack of global spending on exploration and refinery upgrades, saying this would elevate demand for oil until the end of the decade. Page B3. --
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