Feeling Crook - And Better Off For It

Sydney Morning Herald

Tuesday November 18, 2008

Matt O'Sullivan

Matt O'Sullivan wouldn't miss a bank briefing for anything.

MACQUARIE BANK's chief teller, Nicholas Moore, will be running the show today without hisco-pilot David Clarke.

Clarke, who also happens to be Goodman Group's chairman, is on a drip in hospital after suffering a "stomach-related" illness - believed to be a ruptured ulcer - at the weekend.

Goodman had to call in the corporate paramedic Ian Ferrier at the "last minute" yesterday to stand in as chairman for its annual meeting in Sydney. Although Ferrier told shareholders that Clarke was "quite sick", Goodman's chief executive, Greg Goodman, said later over a scone that the illness was not life-threatening, though Clarke was crook enough for a few days in hospital.

Clarke missed seeing Greg Goodman's elder brother, Patrick junior (who runs the Goodman family's private investments), having almost a fifth of votes cast against his re-election to the board.

But it might not be a bad MacBank earnings briefing for the wine aficionado to miss today due to the hefty writedowns set to weigh on the bottom-line and with the share price at a six-year low.

Parting is no sorrow

News Corp's No. 2, Peter Chernin, shouldn't have to think hard about whether he stays on.

The Los Angeles Times has stoked speculation that News's chief operating officer will not renew his contract next year, suggesting he is keen to try something new before he turns 60. Chernin could even be mirroring Lachlan Murdoch's move to become his "own man" rather than take the keys from his father to the world's most powerful media empire.

And why not? Chernin, 57, who was paid almost $US29 million ($52.5 million) this year, stands to pocket $US40 million in cash if he "resigns for good reason". The bigwig at Lorimar Film also collects a swag of other benefits, including medical and life insurance for the rest of his days.

But the cherry on the pie comes a month after his contract ends. That's when Chernin can demand that News Corp "enter into a six-year motion picture production agreement and a six-year television production agreement". And get this: News will have to buy "at least two pictures per year".

That should be enough to convince any right-thinking man to wave goodbye - although some pundits reckons he'll decide to hang around at News for another two years.

Testing the pitch

John Stewart is a Scot at heart. And with spare time on his hands when he finishes at NAB next month, the bank's departing boss is dropping hints about swapping Melbourne for Edinburgh. After all, the 59-year-old's heart lies with Heart of Midlothian (aka Hearts FC), now third in the Scottish Premier League. He even has aspirations to coach the club, which is owned by a Lithuanian bank.

Asked whether he had be keen to chair the recently nationalised Royal Bank of Scotland, Stewart told The Scotsman: "I'm always interested in Scotland and I am open-minded about my job."

Stewart is even taking an optimistic view on banking in the highlands despite the near-nationalisation of the country's banking system by Gordon Brown, the British PM, who also happens to be a Scot.

"Scotland is synonymous with banking so we will rise again," Stewart declared.

Even if he does move home, he will still make regular trips down under at the pointy end of planes - care of Telstra shareholders - to attend the telco's board meetings.

Watching the clock

James Hardie's chief chippie, Louis Gries, is certainly able to put on a "showstopper".

Apart from scrapping its dividend and posting a profit drop yesterday, James Hardie continues to be dogged by "legacy issues" affecting its corporate costs. That's boardroom speak for things such as asbestos liabilities.

Included in the "corporate costs" in the second quarter were expenses relating to its courtroom tussle with the corporate watchdog over accusations former Hardie execs and directors misled investors.

And, as you know, lawyers bill in six-minute blocks. The legal expenses almost trebled to $5 million in the second quarter, and the Chicago-born Gries wasn't even going to try to estimate the overall cost.

He said, though, that the trial was going more quickly than he thought. "If it went for any longer it would be very depressing - from a cost viewpoint."

It hasn't been a good year for the boss of the Netherlands-based Australian building materials company. Having got over the asbestos bump, Gries faces the mother of all slowdowns in the US.

At least he wasn't hobbling into the Museum of Sydney on crutches yesterday to brief analysts, like he had to in May after breaking bones in his foot.

Bring out your dead

ERG shareholders finally held a wake for the stricken smartcard company yesterday.

They handed the company's core business to the major creditor and director Duncan Saville, in return for a debt free shell with a potential $200 million claim against the fiscally challenged NSW Government.

ERG's chairman, Colin Henson, declared in tones akin to a funeral: "Ladies and gentlemen, it is with sadness that we are meeting . . . to consider and vote on a proposed restructure of the ERG Group." ERG even loses its name as part of the restructure, and will instead be known as Videlli. Henson described it has an amalgam of the Latin words for integrity, ingenuity and diligence.

© 2008 Sydney Morning Herald

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