Australia

Aussie fires light tiny flame under climate action

22 January 2020

The damage may cost an estimated 0.5% of GDP, barely registering in the $1.3 trln economy. Politicians may act as social costs mount, but change will come faster if stakeholders also heed warnings that “secondary perils” could be recurring rather than one-off.   

Aussie fires could be tipping point for carbon tax

13 January 2020

Horrendous bushfires are pushing CO2 emissions cuts ever further into the spotlight. The scope for sharp hits to earnings at domestic champions like airline Qantas has stopped Canberra properly pricing carbon before. But inaction is becoming increasingly unsustainable.

Infrastructure investors catch the tech bug

9 January 2020

Macquarie may be in talks to buy AirTrunk for over $2 bln. It follows a record year for data centre M&A which saw volumes triple. Growing consumption of the new oil is fuelling demands for storage warehouses. And the hunger for yield is building up towering multiples.

Aussie petrol station bidding war lacks fuel

8 January 2020

UK-based EG Group is interested in buying pump operator Caltex Australia, raising pressure on Canada’s Couche-Tard to up its $6 bln offer. Its costs could already far exceed returns, however. For the target, it’s only a possible relief from a fraught go-it-alone IPO plan.

AB InBev’s Oz M&A party leaves antitrust headache

12 December 2019

The world’s biggest brewer’s $11 bln sale of its Australian unit to Asahi has been challenged by the country’s watchdog. Its tough stance on beer and cider competition may hurt boss Carlos Brito’s plan to cut debt. The Corona-maker has other options, albeit less appetising ones.

Viewsroom: Angela Merkel faces early retirement

5 December 2019

The German chancellor’s administration is in peril after coalition partner SPD chose left-wingers to lead the party. A snap 2020 election would probably end her 14 years in power and remove another of the world’s centrist governments. Plus: Australia’s colossal bank scandal.

Gold diggers may find growth is copper-bottomed

5 December 2019

Rising prices have filled coffers for bullion miners. Now some, like $31 bln Barrick, are arguing future growth may come from a more modest metal: copper. Using safe-haven returns to bet on a similar, underperforming, material has logic, despite tarnished M&A precedents.

Aussie rate setters on a slow road to asset buying

2 December 2019

Consumption is weak and joblessness is rising. The central bank has room to cut rates from a record low of 0.75%, and can resort to bond purchases after that. But Governor Philip Lowe wants fiscal policy to do more. He can ramp up pressure on the government by taking his time.

Canada’s Aussie gas station bid needs more fuel

26 November 2019

Quebec-based Couche-Tard has offered $7.3 bln including debt for Caltex to expand its filling station empire Down Under. At more than 9 times EBITDA the price looks good, while rival bidders are scarce. A mooted real estate IPO is Caltex’s best hope to squeeze out more value.

Banks Down Under have further depths to plumb

26 November 2019

Westpac is parting ways with both its chairman and CEO, days after a money-laundering scandal erupted. The $58 bln Aussie lender becomes the latest of the Big Four to replace its top brass. Persistent rot suggests investors may be underestimating the cost of the cleanup.

Australia’s misbehaving banks run out of excuses

22 November 2019

Amid a $1.7 bln capital call, Westpac has been thwacked by a regulator for 23 mln money-laundering violations. Boss Brian Hartzer will find it hard to stay. The country’s lenders already have been shamed, fined and punished in other ways. It’s unclear how to set them straight.

The Exchange: Carbon-free superpower

20 November 2019

Bushfires and a historic drought have put climate change front and centre for Australia, increasing pressure on a pro-coal government to act. Ross Garnaut, economist and former Canberra adviser, explains why there's an opportunity Down Under that may outweigh the cost of change.

BHP boss hands over big shovel to successor

14 November 2019

Andrew Mackenzie departs the world's largest miner next month, leaving it in better shape than he found it. Veteran Mike Henry will face fresh challenges. He must make and sell a decision on a $20 bln potash project, and steer the steel ingredient producer into a greener era.

Australia compounds resource industry climate woes

8 November 2019

Prime Minister Scott Morrison wants to crack down on environmental protesters. Companies, he argues, should listen to "quiet shareholders" instead. That's bad advice for outfits like BHP and for his government: both deserve to face more pressure on low-carbon options, not less.

Macquarie shape-shifts into lucrative green niche

1 November 2019

The $30 bln Aussie bank is good at morphing to stay ahead. Commodities hedging helped lift first-half earnings. Its next phase is a bet on renewables. With fewer constraints than rivals, Macquarie is well-placed to go green. New projects may be shorter-term though, and riskier.

Buyout giants get an IPO warning from Down Under

24 October 2019

Bain, KKR and TPG have all pulled Aussie listings this month. With the local bourse just off historic highs and new entrants doing well, the finger of blame is starting to point at private equity. Friendlier terms and healthier balance sheets are needed to keep the exits open.

Aussie fintech runs up move-fast-break-things tab

21 October 2019

Like other hot startups, $5 bln buy-now-pay-later outfit Afterpay operates in a grey area. Because it is not covered by credit rules, customers borrow for free. Success is inviting scrutiny; regulatory concerns have just erased over 20% of its value. The harder part has begun.

Aussie engineer tugs too strongly on the flag

17 October 2019

A $5 bln oil services company wants the foreign-investment watchdog to stop a Middle Eastern investor from raising its stake. It’s an odd defence. Rules that let suitors creep up on their targets may have pushed WorleyParsons into a corner, but it sets an uncomfortable precedent.

China’s eco-friendly debt can be a shade greener

16 October 2019

Beijing's rules for its pioneering $40 bln green bond market are still too pliable: a refiner last week issued a note to pay for a petrochemical complex. A central bank review now underway offers a chance to boost credibility by pushing guidelines closer to international norms.

Greed and gloom sink KKR’s Aussie lender IPO

16 October 2019

The U.S. buyout firm and other investors scrapped a second attempt to list Latitude after buyers rejected a $2.1 bln valuation. Even after a price cut, the discount to big banks was too modest. Debt-laden households, struggling with flat wages and precarious jobs, hardly helped.