Gold diggers may find growth is copper-bottomed 5 Dec 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 Dec 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 Nov 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 Nov 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 Nov 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 Nov 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 Nov 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 Nov 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 Nov 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 Oct 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 Oct 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 Oct 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 Oct 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 Oct 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.
Big steel can reform its way to a longer life 30 Sep 2019 Rio Tinto will work with China's top producer to make steel greener. From Shell to BHP, resources firms are starting to tackle emissions churned out by oil, coal and the like, after they are sold. Such climate-friendly moves may also keep costs manageable, and an industry going.
Aussie lender’s revamped IPO is poorly timed 24 Sep 2019 KKR-backed consumer finance outfit Latitude is planning a listing that could value it at $2.5 bln, a more modest pitch than in 2018. Since then, big banks have retreated and the equity market has heated up. Wages are flatlining, though, raising risks for providers of easy credit.
BHP’s pay plan forges dual path to sustainability 23 Sep 2019 The $122 bln miner wants to make more of its CEO's bonus dependent on emissions and other yet-to-be-provided climate goals. As importantly, it is trimming incentives and making bosses hold shares for longer. In an industry struggling to regain investor trust, both are important.
Weaker Aussie jobs clear fiscal spending path 19 Sep 2019 More people worked Down Under in August, mostly because of an increase in part-time positions. Overall unemployment ticked higher to 5.3%. It makes another interest rate cut more likely, but goosing government outlays would be a more effective option for the cooling economy.
Dairy deal Down Under unlocks China prize 17 Sep 2019 State-backed Mengniu wants to buy Bellamy’s, a maker of infant formula, for some $980 mln. The premium looks frothy, and such tie-ups have soured before. But if local ties mean licences and an Aussie brand lures wealthy buyers, shareholders are right to bet on success.
Airlines flash economic warning lights Down Under 22 Aug 2019 Profit at Qantas and Air New Zealand fell, hurt both by pricey fuel and headwinds at home. Corporate and discount travellers alike are pulling back, and neither carrier is offering much future guidance. Any benefits of rock-bottom interest rates are taking time to trickle down.