TV ads sway more than online: survey

ADVERTISING on TV continues to be far more influential than ads online, with many people complaining about the intrusiveness of digital ads and their potential to invade privacy.
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According to research by Deloitte, which surveyed people in eight countries, television advertising was the most influential on consumer decisions in Australia, followed by newspaper ads and online.

But online advertising is catching up to traditional media with the fast-growing influence of online reviews. The survey found that 56 per cent of people learnt about a new product online for the first time and 43 per cent bought something based on an online review or recommendation.

The report also found that many shoppers, 41 per cent, checked competitors’ prices on their smartphones while in a shop. Dubbed ”word of mouth in the 21st century”, the researchers concluded that checking prices online had become everyday behaviour.

The survey results provide an interesting dilemma for advertisers, with people concerned about the potential for invasion of privacy with online ads, but also interested in more targeted online marketing. Many of those surveyed said they would click on more ads if they were targeted to their needs.

Researchers said that the online advertising community needed to provide more reassurance to consumers regarding the collection, use and security of personal information, in order to overcome people’s privacy concerns and boost effectiveness.

Among the types of advertising available online, Australians preferred search engine advertising, interactive advertising and advertising on apps on mobile phones. But video-based pre-roll and post-roll ads were not very influential on buying decisions, ranking fifth and 10th in terms of influence.

Deloitte Technology, Media and Telecommunications partner Clare Harding said the research also showed that while TV was the preferred form of entertainment for most Australians, 60 per cent of those surveyed were multitasking on other electronic devices.

”Opportunities exist for newspaper publishers and advertisers to connect with consumers across multiple platforms and provide an integrated content or brand experience. Advertisers should also take the opportunity to rethink ad design and incorporate the ‘small screen’ of smartphones, tablets and laptops into the ‘big screen’ viewing experience of the TV,” Harding said.

The report, undertaken between November 2011 and March 2012, surveyed around 2000 consumers in each of the eight countries surveyed, with those interviewed spanning four generations. This is the first year Australia has participated.

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Mojo names former ninemsn head as chief

FORMER ninemsn chief executive Joe Pollard is set to become the most senior woman in Australian advertising as she takes over as head of Publicis Mojo Australia.
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Ms Pollard joins the company at a time of huge change for the industry, with the softening of advertising markets and the rise of digital.

Publicis Worldwide earlier this year also took over ownership of the Australian company.

Publicis’ blue-chip clients include Coca-Cola, Toyota, LG, Qantas and Goodman Fielder.

The executive chairman of Publicis Worldwide, Jean-Yves Naouri, flew to Australia to make the announcement, praising Ms Pollard’s leadership experience in marketing communications, creative, media and digital. Ms Pollard has been chief executive of ninemsn for three years. Under her leadership, ninemsn showed strong growth in audience engagement, revenue and profitability. Two offshoots, Cudo and Bing were also launched.

Mr Naouri said Ms Pollard had a wealth of experience in all aspects of marketing and communications.

”Given her time on agency side, client side and recently running the largest digital publisher in Australia, I believe she brings a unique set of skills to Publicis Mojo,” he said.

Ms Pollard was at Nike for 10 years, including time as chief marketing officer.

Ms Pollard said Publicis Mojo had an amazing roster of world-class clients facing complex business challenges in a changing environment.

Publicis Mojo’s executive chairman, Graeme Wills, and chief executive Nicholas Davie, both set to step down from their roles, will stay on in the short term to help a smooth client transition.

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Tinkler’s new challenge bit close to (his old) home

RECENTLY Singapore-domiciled billionaire electrician Nathan Tinkler still has plenty of unfinished business in his home town of Newcastle.
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Just as a Tinkler-led consortium proposed a (perhaps, maybe) $4 billion takeover of Whitehaven Coal, another ASX-listed company has lobbed some paperwork in the New South Wales Supreme Court for another Tinkler company to mull over.

A contractual dispute has erupted between a Mirvac Group-related entity – Domaine Steel River Pty Ltd – and one of Tinkler’s companies – Ocean Street Holdings Pty Ltd – over the purchase of a block of land on the southern side of the Hunter River.

Tinkler is yet to hand over any money for the land, which is believed to be tied to his proposed (perhaps, maybe) $2.5 billion coal terminal. Mirvac was not commenting yesterday. But one source close to Tinkler said he still intended to proceed with the land deal and that he only disputed some aspects of the contract.

The Tinkler Group website notes how his proposed (perhaps, maybe) terminal would incorporate a rail marshalling area in the Steel River industrial zone, which is being developed by Mirvac.

The matter has been set down for a one-day hearing in August.

Yates’ words of wisdom

LOYALTIES towards casino billionaire James Packer appear to run deep on one leafy street in Hawthorn.

And we’re not talking about the man the Crown Limited executive chairman tried to install as the chairman of Echo Entertainment, former Hawthorn Football Club president and former Victorian premier Jeff Kennett.

”Not only is Packer’s idea of a new casino on the site of an old shipyard historic, it is a must,” said a letter published in last Sunday’s Sun Herald and The Sunday Age supporting Packer’s controversial proposal to build a casino in Sydney’s Barangaroo precinct.

”Most people are over the images of the Harbour Bridge projected across the globe; they need something new to Google. Let’s entice these customers to our foreshores with new highlights and create means by which in doing so they see the rest of the city,” said the letter scribed by one Timothy Yates of Hawthorn Grove in Hawthorn.

It just happens that the former Allco Equity Partners managing director and ex-chief executive of the former Packer-controlled PBL, Peter Yates, also lives on Hawthorn Grove.

But Yates yesterday expressed his surprise when contacted by CBD. ”I have a nephew called Timothy Yates. He doesn’t live with me,” confirmed the former PBL boss. Yates said he was totally unaware his nephew, who apparently lives in an apartment up the road from him, had taken an interest in the exploits of his former employer.

”He lives in Hawthorn Grove but not in my house,” Yates added, before saying that he had to go.

CBD is heartened to see the folk of one Hawthorn street have an interest in the appearance of Sydney Harbour.

”With an ailing economy in the retail sector, Australia’s reliance on the ASEAN region is becoming even more imperative. At the end of the day, if a buck is to be made, the reasonable man is going to see that dollar out,” said the letter from Peter Yates’ nephew.

Not always a banker …

GOLDMAN Sachs chief executive Lloyd Blankfein shocked financial markets on Wednesday night when he confirmed he had human emotions by cracking a joke at a function in Chicago.

Asked when he planned to retire, the world’s most powerful investment banker said: ”I am 57. What am I going to do with the other 60 years of my life?”

Blankfein’s ongoing campaign to prove that he and other Goldman Sachs employees had human feelings also saw him give small business tips on an American morning TV show this week with one of his banjo-playing billionaire investors, Warren Buffett.

The Goldman boss, who has helped initiate a scheme to help provide better access to capital for 10,000 small businesses in order to grow jobs, told the TV program it was good for business owners not to get ”over-leveraged”.

The head of the investment bank – once cruelly described as ”a great vampire squid wrapped around the face of humanity” – at the start of the year also appeared in a television advertisement in the US (produced by the Human Rights Campaign) that called for marriage equality.

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Sims eyes supermarkets taking out the small guy

THE ACCC is considering seeking legislation to limit the steady increase in market power of the leading supermarket chains following their steady acquisition of smaller retailers, which is limiting competition in key markets.
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In his strongest comments since taking over as the chairman of the Australian Competition and Consumer Commission nearly a year ago, Rod Sims has signalled concerns over creeping takeovers by Coles and Woolworths, which may be leading to reduced consumer choice.

Existing competition legislation does not place a cap on market shares or allow the ACCC to assess the cumulative impact of previous acquisitions when studying new acquisition proposals.

His concerns come at a time when the large chains are boosting their position in the liquor, grocery and home improvement sectors, in particular, ”which raises competition concerns”, he said.

”Barriers to entry for other chains or buying groups to replicate the strong market position of Wesfarmers [Coles] and Woolworths are becoming increasingly high,” Mr Sims said yesterday. ”Added to this often are local barriers associated with, for example, access to sites.”

As a result, the ACCC wants to ensure that further acquisitions do not lead to retail or wholesale industry structures that may reduce market competition, or choice, for consumers.

”Because of these concerns, the ACCC has been paying increased attention to incremental acquisitions to identify which acquisitions require review and, of those which raise competition concerns,” he said.

”I don’t think any other country in the world has an effective law here, which just shows it is difficult,” Mr Sims said yesterday of any legislative response to creeping takeovers.

”It is not an easy area of law, to

actually construct a law that works effectively in the marketplace in all circumstances, because if you had a creeping acquisition law it would apply to all sectors. So, doing something that does more good than harm is difficult to construct.”

The ACCC will be in a better position to judge how big a problem the issue of creeping takeovers and rising market power is in the next six months or so, he said.

But, as an interim step, the ACCC is to speed up its review of acquisition proposals in the retailing sector by seeking earlier disclosure of plans by retailers, which will then be reviewed by a special team, which will provide a quicker decision.

”Our processes can be streamlined,” Mr Sims said. ”This can, however, only occur with appropriate notification, co-operation and upfront information.”

The ongoing acquisition of smaller retailers is giving the major chains ”substantial economies of scale and scope in, for example, distribution logistics centres and advertising as well as brand promotion”.

This is making it more difficult for competitors to emerge which, together with the difficulty of gaining access to sites, is entrenching the power of Coles and Woolworths.

”When the major supermarket chains acquire an independent player, they remove an alternative from the market, with potentially a different product range and service offering,” Mr Sims said.

”That competition is unlikely to be replicated by either a chain or new independent given local and/or national entry barriers.”

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Demand, not carbon, drives expansion

It’s the timing of the Olympic Dam expansion that is being reviewed and, despite what the opposition may say, the carbon tax and mining tax are not decisive.EVEN taking into account the fact Canberra’s spin cycle is in overdrive ahead of the July 1 start of Labor’s carbon tax, Tony Abbott and Christopher Pyne have been a bit hyperbolic this week.
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During a whistle-stop tour of South Australia, Abbott said BHP Billiton’s $30 billion Olympic dam expansion project was ”hanging in the balance”. Axing Labor’s carbon tax and mining tax and reining in ”union militancy” were three major incentives that a Coalition government would deliver, he said, adding that in the meantime the Labor government should guarantee that its mining tax won’t be extended to gold, copper and uranium.

Pyne said BHP was reconsidering the timing of the Olympic Dam expansion because of heightened political risk, adding: ”I directly blame the Gillard government for that.”

The truth is more complex, as usual. It’s the timing of the Olympic Dam expansion that is being reviewed, and the carbon tax and mining tax are not decisive.

BHP chief executive Marius Kloppers, the group’s chairman, Jac Nasser, Rio Tinto chief executive Tom Albanese and Glencore chief executive Ivan Glasenberg have all warned recently that Australia is becoming a more expensive place to invest in, and a more regulation-heavy one.

But as BHP reacts to softer commodity markets by re-sequencing its lengthy line-up of potential resources developments, Australia’s carbon tax and mining tax are not front of mind: hardly surprising really, given that Kloppers is a supporter of carbon pricing and helped negotiate a watered-down mining tax after Julia Gillard pushed Kevin Rudd aside in June 2010.

Kloppers said in September 2010 that BHP accepted that climate change was a reality and added that, because the multilateral push for a carbon pricing regime had been derailed, Australia would be best served by going alone, and going early.

The BHP view at that time was that carbon pricing was inevitable, but that it needed to be simple, transparent and predictable, revenue neutral and broadly based, but also designed to protect trade-exposed industries.

He has subsequently criticised the structure of the Australian carbon-pricing regime, saying for example that the imposition of a carbon tax on the coal industry makes it more costly, and therefore less attractive as an investment destination than it was compared with coal-producing countries, including Indonesia, that have not yet introduced carbon pricing.

Nasser has called for a slower introduction of carbon pricing here and he has also said he thinks Labor’s Fair Work Act should be redrawn to reduce ”disproportionate union influence”.

And yes, getting the go-ahead for a mine development in this country is a regulatory marathon. It took more than five years to negotiate it in Olympic Dam’s case and more than 8300 people, 38 government departments and service providers, 55 non-government organisations and 60 industry groups had a role in the development of the project’s environmental impact statement.

We can do better than that.

It’s worth noting that BHP’s consistent message has been that it understands that careful and open planning and consultation is needed to build a lasting consensus around a development of the size of Olympic Dam, the world’s biggest uranium deposit and fourth-largest copper deposit.

BHP has also not stepped back its overall support for carbon pricing. In fact, it’s been loading a price for carbon into its investment decisions for years. The structure of the tax here is not its ideal, but BHP believes it can live with it.

The key forces behind BHP’s rethink about major expansions, including Olympic Dam, are commodity demand and commodity prices.

Both have softened as the northern hemisphere sovereign debt crisis and the economic slowdown it has induced depresses China’s growth, and as the hangover from last year’s over-zealous attack on inflation in China endures.

The price of copper, Olympic Dam’s main product, leapt by 257 per cent between December 2008 and mid-February last year for example, but has since slid by 27 per cent.

Kloppers and Nasser have been pretty clear on this, with Nasser flatly answering ”no” to a question in mid-May about whether BHP was going to stick to a previously announced five-year $US80 billion capital expenditure budget, and Kloppers stating that iron ore demand will grow strongly but less rapidly in the next decade than it has in the past 10 years. He also predicted that after 2025 it will move into a ”protracted period of low to negative growth”.

BHP has 22 major project developments and expansions under way, and they will soak up the group’s spending power in the 2012 and 2013 financial years. Thereafter, BHP would have ”flexibility” on project sequencing, Kloppers said last month, and it will be running the slide rule over new prospects very carefully.

The sums on projects here, including Olympic Dam, will include the cost of the mining tax and the carbon tax, and BHP will also be comparing labour productivity.

Commodity prices are the big variable, however – if they stay off the boil, projects like Olympic Dam will proceed more slowly regardless of what party is in power in Canberra.

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Huge debts mean Hastie creditors to get little

THE administrator of Hastie Group has dashed lingering hopes of substantial returns for creditors, signalling that few businesses of the once-sprawling engineering services company will find new owners.
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Speaking after a creditors’ meeting in Melbourne, Ian Carson, of PPB Advisory, said Hastie’s debt bill included $100 million owed to ”many thousands of creditors”, with rural and regional suppliers particularly hard hit. This amount is in addition to $500 million owed to banks that funded its acquisition binge.

Many creditors travelled from regional areas to hear it was unlikely they would receive ”any extensive” return, given the debt to banks. These creditors included labour hire firms, and suppliers of plastic fittings and guns for fastening, some of whom were owed ”serious amounts” of up to $500,000, Mr Carson said.

”They’re really normal, ordinary businesses … and a lot of them are locals. You know, Albury and Shepparton, regional areas,” Mr Carson told a media conference after the meeting. He described the mood of the meeting as ”sombre”.

Mr Carson said of the 44 businesses under Hastie’s control, just five had been sold for a combined sum of less than $30 million, and another one or two may be sold for modest amounts.

Receivers and managers McGrathNicol, appointed by Hastie’s banks, have taken charge of Hastie’s stronger assets, but Mr Carson was downbeat on the prospect of substantial returns from the sale of those companies.

”It’s hard to imagine there being a material return even after McGrathNicol,” Mr Carson told BusinessDay.

Asked whether he had greater

insight into the cause of Hastie’s collapse, Mr Carson said: ”There have obviously been some failures, whether it’s corporate governance or other things.”

He estimated about 1200 jobs had been saved across Hastie’s local workforce, now under PPB’s remit, of the 2700 stood down, excluding the 1800-odd at companies taken over by McGrathNicol.

A spokeswoman for McGrathNicol said yesterday there was no update on its sale process for Spectrum Fire and Safety, Hastie Services, industrial refrigeration systems company Gordon Brothers Industries and Austral Refrigeration. Austral was for sale when Hastie collapsed.

The secretary of the Plumbing Trades Employees Union, Earl Setches, said the vast majority of its members had held onto work and their entitlements in Victoria. He said of the 600-odd Hastie workers in the state, just a handful were now out of work. Of the 350 members directly affected in NSW, he estimated 300 were back in work.

Hastie had about 7000 workers globally when it collapsed last month, after the discovery of a long-term accounting ”irregularity” foiled a recapitalisation plan.

Mr Carson said legal action related to the collapse had not been his focus but he would be meeting with directors and shareholders in the months ahead. Listed litigation funder IMF (Australia) and law firm Slater & Gordon have confirmed they are keeping an eye on the collapse.

There was a 150-day extension sought for the convening period before the next creditors’ meeting, Mr Carson said.

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Tackling the Tax Office over its interpretations

THE Australian Taxation Office has long been the elephant in the room when it comes to business, investment, superannuation and financial matters. What is often not appreciated is how much the ATO uses its weight and size advantage to squash taxpayers into submission in its pursuit of maximising tax collections.
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The ATO achieves this in two ways. The difference between the two methods primarily comes from when the ATO employs them. Under the first method tax assessments are issued based on the ATO’s interpretation of the law and either result in tax deductions being disallowed, amounts received being classed as taxable income, or applying a higher tax rate.

An example of this last method was when the ATO during the 1980s charged taxpayers that had lost their jobs an extra tax on lump sum termination payments received. In this example the ATO, despite a great deal of evidence to show its interpretation was incorrect, was forced into doing the right thing by the passing of amending legislation. The second method is far more effective as it involves the ATO issuing rulings and guidelines that affect decisions made and actions taken by taxpayers. This is done by the ATO issuing statements, meant to help taxpayers understand certain aspects of the law, which are not backed by either case law or legislation.

These rulings place an interpretation that maximises tax revenue collection. By issuing these rulings the ATO uses its size, and the genuine fear of taxpayers and professionals of being dragged into a protracted dispute, to effectively rewrite tax legislation and reinterpret tax cases.

A recent example of how the ATO uses both of these methods relates to the taxation of family discretionary trust income. In March 2010 the High Court handed down a decision in favour of a taxpayer in a dispute with the Tax Office that has become known as the Bamford case.

The case revolved around a discretionary trust’s ability to distribute different types of income, such as capital gains and franked dividends, to different beneficiaries in set amounts. The ATO had issued an assessment based on its interpretation that was challenged by the taxpayer.

The High Court ruled in favour of the taxpayer. At the heart of the judgment, the High Court decided that what a trust could do was decided more by trust law and the deed setting up a trust, and not by the ATO trying to place a self-serving interpretation on tax law. The judgment in this case also led to amending legislation that also forced the ATO into applying the decision of the court to all trusts.

In response to the court case in the new legislation the ATO recently issued an income tax ruling. The ruling is again placing an interpretation on tax law designed to force trustees and professionals into acting in a way that again potentially maximises tax revenue collections.

Allan Swan, a tax law specialist with Moores Legal, said: ”The ruling has stretched beyond recognition the High Court’s view of what constitutes trust income for a family trust or a deceased estate. There is no mention in the Bamford decision that the definition of trust income cannot be set to match the income tax definition.”

With recent comments from the left wing of the Labor Party and the increasingly pugnacious attitude of the ATO towards trusts, trustees have two options. The first is to sit back and cop whatever comes their way. The second is to voice their objection and communicate this to their member of Parliament.

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Rinehart lifts her stake in Fairfax

Mining magnate Gina Rinehart.MINING magnate Gina Rinehart has increased her hold on Fairfax Media in a sharemarket raid that has taken her stake in the publishing house to more than 15 per cent.
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After months of her ratcheting up pressure on the board to deliver her two board seats, market sources believe Mrs Rinehart, already the company’s largest shareholder, has lifted her stake by about 2 per cent to 15-16 per cent.

The world’s wealthiest woman is believed to have bought at least half of the 78.7 million shares traded yesterday – quadruple the normal trading volume – including a single line of 42 million shares sold at lunchtime for 60¢ a share.

A spokesperson for Mrs Rinehart declined to comment, but all major investors are required to advise the stock exchange if they buy or sell more than 1 per cent of the company within two days.

Mrs Rinehart is believed to have appointed brokers Bell Potter to buy more shares in Fairfax (owner of The Age and The Sydney Morning Herald) in her bid to lift her stake to 19.99 per cent – the maximum allowed before a shareholder needs to make a takeover offer.

The more shares Mrs Rinehart buys, the harder it becomes for the board to resist her push for seats, particularly if she wins approval from other institutional investors.

A fellow major shareholder, funds management group Allan Gray, which also recently lifted its shareholding to more than 9 per cent, has previously expressed qualified support for Mrs Rinehart. Managing director Simon Marais has called for an overhaul of the company, saying the board needed a tough outsider to shake things up and that Mrs Rinehart might be the right person.

Mrs Rinehart has been an outspoken critic of the board and management of the company, along with her close adviser Jack Cowin, who has been tipped as Mrs Rinehart’s choice for a second board position.

Sydney radio network owner John Singleton, a friend of Mrs Rinehart’s, told The Age yesterday the board’s refusal to give her a seat was ”the worst corporate insult I’ve ever seen”.

Late last month, Mrs Rinehart refused to speculate on whether she would lift her stake as the company’s share price slumped to record lows, saying: ”It is too early to say if Hancock Prospecting [the company through which Mrs Rinehart

owns her stake] will hold its more than 13 per cent shares in Fairfax or sell them or find some other satisfactory resolution.”

Hancock Prospecting chief development officer John Klepec said this week that the board should demonstrate its commitment by buying more shares.

”If the chairman and board are true believers in the strategy to assist the company, surely they would have a reasonable percentage of their net worth in Fairfax and be taking opportunities to add to this when the opportunity arises,” he said.

”We understand, for instance, that the chairman only has 99,206 shares and has not added to his shareholding.”

Michael McCarthy, chief market strategist at CMC Markets, said the share price, which has fallen nearly 85 per cent in the past five years, demonstrated that investors did not believe the company had sufficiently embraced the opportunities presented by online media.

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Rumours fly in flimsy market

Perpetual became the focus yesterday when questioned by the ASX over a share-price spike.WHEN markets dramatically retreat the way the local market has done in the past three months and share trading volumes dry up, talk often turns to takeovers. Sometimes it is a case of hedge funds, brokers and investment banks trying to generate interest in a stock to make some money, and at other times it is because the share price has fallen so low that it becomes an obvious target.
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In the local equities market, volume yesterday was a woeful $3 billion, which is well below the typical daily average of $4.5 billion. To put it into some context, at $3 billion it is 45 per cent lower than last year’s average and more than half the daily average of the peak in June 2007 which was $6.6 billion a day. Such low average value trades per day coupled with a falling equity market – down 7 per cent in the past three months – is not only hurting the stockbroking industry, with some players struggling to meet their overheads, but it has turned the spotlight on stocks that have either had a sudden share price surge or above-average turnover.

Yesterday morning Perpetual became the focus when it was queried by the ASX over a share-price spike following rumours that an unnamed private equity fund was looking at making a bid. It prompted the ASX to issue a query, to which Perpetual responded with a stock standard answer that it was unaware of any explanation for the price rise other than the market reaction to media speculation about an interested buyer. Nevertheless, the stock closed almost 10 per cent higher at $23.79.

The other stock in focus yesterday was Fairfax Media, when 42 million shares were put through at 12.28pm by Southern Cross Equities at 60¢ a share. At the close of trade, another 36 million shares had changed hands.

The share bulge naturally raised speculation that the company’s biggest shareholder Gina Rinehart was increasing her stake beyond 13 per cent with the aim to go towards 19.9 per cent, which is just below the takeover threshhold, to improve her chances of getting a seat on the Fairfax board. (Fairfax is owner of The Age).

But Fairfax and Perpetual are not alone. Other companies that have been the subject of market speculation include Qantas, Echo and Pacific Brands. In some cases a bid will emerge. In others, though, it will be an attempt to spread the rumours to generate business or inflate the share price. There is no doubt that investment banks, stock brokers and hedge funds are doing it tough. It would not surprise if some investment banks were flying kites in the form of speculation to gauge industry interest in certain companies, while in other cases the rumours are being spread by hedge funds trying to game the market. In other cases, the share price has fallen so low that it becomes affordable for private equity and other trade buyers to make a tilt.

For instance, CSR’s shares fell to a 25-year low yesterday, putting it on a market capitalisation of $766 million. It will be interesting to see if rumours emerge of a takeover offer for CSR. In the case of Qantas, its shares fell below $1 last Friday, making it an attractive takeover target. And in the case of Echo, the recent emergence of James Packer’s Crown and Genting on the register has inflated the share price by at least $1. Whether the rumours translate into something more concrete, time will tell. But what is certain is that over the next few months there will be more rumours as investment banks and stockbroking firms try to keep their heads above water as markets continue their wild volatility until Europe sorts itself out.

The hope is that the Greek elections on Sunday will produce a stable government that will help settle investor fears. But that is a big hope. For starters, there is still the issue of Spain, which wasn’t helped by Moody’s decision overnight to downgrade its rating on Spanish government debt by three notches to Baa3 from A3.

Moody’s is concerned that the newly approved eurozone plan to help Spain’s banks will increase the country’s debt burden. But there are bigger problems bubbling away.

Spain has said there will be minimal conditions but only Spain knows what they are and is expected to unveil them after the Greek elections. This has led some market watchers to believe that the bailout was announced to encourage Greeks to vote sensibly at the weekend. As one observer said: ”The bailout announcement would no doubt encourage Greek voters to elect candidates this weekend who would keep Greece in its austerity program. That is, look how bad things are – even Spain needs a bailout.”

The upshot is the Greeks will learn about the Spanish rescue conditions after they have voted. If the conditions are not to their liking, watch out Europe.

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Sydney Airport to land more tourists

Low-cost airlines like Scoot are providing extra lift for Sydney Airport.SYDNEY Airport was ”stepping up its role” in the tourism space, said chief executive Kerrie Mather, and there had already been wins with the arrival of low-cost Asian airlines AirAsiaX and Scoot.
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At a business lunch yesterday in Sydney, Ms Mather signalled closer co-operation with Tourism Australia and New South Wales Tourism.

She said she had travelled to India as part of the NSW Tourism delegation and was hopeful that direct flights to India from Sydney would eventuate. She had also just returned from China, which was a ”market with potential for us”.

Ms Mather said last year 640,000 passengers from China came through the airport and this year China would move to second place, behind New Zealand, as the dominant country for the airport’s visitors.

She reiterated that Sydney Airport Corporation welcomed the federal government identifying a future airport site for a second Sydney Airport and securing transportation corridors, but said the existing airport could deal with demand through until 2045.

Last week the corporation issued legal proceedings against the federal Minister for Transport, Anthony Albanese, after the government brought forward to mid next year a deadline for the airport to produce a draft master plan.

Ms Mather said the airport was consulting about a new plan it announced in December last year, which will see a reconfiguration of the airport, including moving the jet base and air traffic control tower, and integrating domestic and international flights from the same terminals.

”We are halfway through that period of consultation so we were on track delivering our master plan by 2014,” she said. ”It is important we incorporate [this vision] in the master plan, so we need time to work through.

”So we have asked for the reasons why the master plan has been bought forward.”

The airport had discussed with Qantas buying back its long term leases for its jet base and terminal, which were not due to expire until 2019, considering that the Qantas sites took up 30 per cent of the airport’s footprint, she said.

Discussions had already resulted in some suggested improvements, which dealt principally with productivity issues, she said.

Ms Mather said the train station access fees on the privately owned Airport Link remained an impediment and she wanted to see both the removal of the fee and improvements on the line, such as better provision for passengers carrying luggage. The NSW government has said it will release later this year a discussion paper on transport for the airport and Port Botany area.

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