PRESS DIGEST-Australian Business News - Apr 21

Compiled for Reuters by Media Monitors. Reuters has not verified these stories and does not vouch for their accuracy. THE AUSTRALIAN FINANCIAL REVIEW (www.afr.com) -- Deutsche Bank and JPMorgan will join ABN Amro, Goldman Sachs JBWere, Macquarie Group and UBS in backing a A$2.5 billion rights issue for West Australian conglomerate Wesfarmers (WES.AX: Quote, Profile, Research). The capital raising is designed to cover A$3.3 billion of short-term debt and avoid a costly rate of interest. The rights issue will be structured on a 1-for-8 basis for the group's 460,000 shareholders at A$29 a share. Wesfarmers stock was fetching A$36.97 a share before entering a trading halt last Wednesday. Page 13. -- Former television producer Reg Grundy is spearheading a Suncorp-Metway (SUN.AX: Quote, Profile, Research) venture to sell petrol on the Internet and undercut petrol stations. Tim Hughes, the former chairman of Macquarie Media Group, is also involved in the online venture, to be known as Fuelmarket. Mr Grundy and Mr Hughes want to link the business with the Federal Government's price-watch scheme, FuelWatch. Under the impending scheme, petrol retailers such as BP and Mobil will be required to notify the competition watchdog of their prices on a daily basis. Page 13. -- Shares in Cazaly Resources (CAZ.AX: Quote, Profile, Research) are expected to fall today after the High Court of Australia rejected its final bid to regain control of an iron ore tenement in Western Australia. The junior explorer acquired the lease to the Shovelanna project two years go, before the State Government intervened and returned it to Rio Tinto. Having lost its latest appeal on Friday, Cazaly said it would now concentrate on its other projects at Kunanalling and West Kalgoorlie. Page 13. -- Woolworths (WOW.AX: Quote, Profile, Research) will install self-service checkouts throughout its supermarkets six years after trialling the system at its Big W stores. The self-service checkouts, which enable customers to scan, weigh and bag their purchases, could reduce cashier transactions by 20 percent. In a staggered rollout, 70 supermarkets are due to be converted by mid-year at an estimated cost of A$100,000 per store. Woolworths' main rival, Coles, is studying similar U-scan technology offered by Fujitsu. Page 14. THE AUSTRALIAN (www.theaustralian.news.com.au) --Chinese steel makers have expressed concern over Rio Tinto (RIO.AX: Quote, Profile, Research) and BHP Billiton's (BHP.AX: Quote, Profile, Research) plans to sell iron ore on the spot market, amid a stalemate in annual contract negotiations. Rio and BHP are demanding an extra premium to account for a disparity in freight costs between Australia and Brazil, whose Vale has already achieved a 65 percent-plus price increase for 2008. The China Iron and Steel Association said selling ore at spot prices was 'irrational' and would 'hurt demand for the Australian ore over the long term.' Page 29. -- Lift Capital managing director Bassem Jammal has promised to meet with creditors and find 'the best way forward' for the Sydney stockbroker, which went into administration earlier this month. 'This is not an Opes Prime situation by any means,' Mr Jammal said, referring to the Melbourne broker that collapsed in late March owing hundreds of millions of dollars to its bankers. Mr Jammal said the whole lending industry was 'a casualty of the Opes Prime fallout.' Page 29. -- Qantas Airways (QAN.AX: Quote, Profile, Research) will sell a half-share in its engine maintenance subsidiary, Jet Turbine Services (JTS), to form a joint venture with Germany's Lufthansa Technik (LHT). The deal includes a 10-year contract with LHT to provide maintenance services for Boeing 767, 747 and Airbus A330 aircraft. Qantas chief executive Geoff Dixon said the new partnership would give JTS access to international customers and improve its technical capability. Page 31. -- The resurgence of the Nine Network continued last week with its third ratings win of 2008, giving the broadcaster an overall lead in the year to date. Nine's 28.2 percent audience share compared with 27.4 percent for Seven and 22.2 percent for Ten (TEN.AX: Quote, Profile, Research) and continued its success in the key 25-to-54-year-old demographic. The week's highest-rating program was last Sunday's Seven News (SEV.AX: Quote, Profile, Research), which averaged 1.726 million viewers in the five capital cities. A repeat of Ramsay's Kitchen Nightmares drew 1.630 million viewers for Nine. Page 34. THE SYDNEY MORNING HERALD (www.smh.com.au) -- Opes Prime clients are considering legal action against the broker's bankers, including ANZ Banking Group (ANZ.AX: Quote, Profile, Research), disputing the ownership of shares lodged with the failed entity. The shares were offered as collateral on margin loans, although ANZ and other creditors have been selling them to pay off more than A$1 billion worth of debt. Opes Prime administrators have warned that litigation could dilute a mooted A30-cents-in-the-dollar payout to clients, because ANZ would use their money to finance its defence. Page 23. -- Analysts have forecast a 10 percent slump in Australia and New Zealand Banking Group's (ANZ.AX: Quote, Profile, Research) pre-tax earnings for the first half, reflecting bad loan provisions. In recent weeks, ANZ has revealed large exposures to the embattled Centro Properties Group (CNP.AX: Quote, Profile, Research) and brokers Tricom Securities and Opes Prime. Reports also put the bank as a large lender to Chimaera Capital, a Melbourne stock lender with a similar business model to Tricom and Opes Prime. ANZ is expected to post an interim underlying profit of A$1.6 billion. Page 24. -- The Reserve Bank of Australia has bought A$320 million in mortgage-backed securities to boost liquidity in what has become a stagnant sector. The packaging of home loans into securitised vehicles has attracted strong investment in recent years, with A$45 billion worth sold in the first half of last year; in the second half the figure was just A$6 billion. The Reserve Bank action is seen as an acknowledgement of the difficulties banks are facing in credit-starved markets. Page 25. -- Two key executives at Macquarie Countrywide Trust (MCW.AX: Quote, Profile, Research) have announced their departure after the unsuccessful auction of 10 local shopping centres. Chief operating officer Ross O'Toole and national portfolio manager Scott Nugent would leave the trust to 'pursue an opportunity offshore,' chief executive Steven Sewell said yesterday. Mr Sewell denied reports that the pair were encouraged to leave. Only two of 10 shopping centres were sold in the auction a fortnight ago. Page 25. THE AGE (www.theage.com.au) --The Seven Network (SEV.AX: Quote, Profile, Research) is chasing a majority vote at a West Australian Newspapers (WAN.AX: Quote, Profile, Research) shareholders meeting on Wednesday to obtain two of four non-executive positions on the WAN board. Proxy votes for shareholders not attending are due this afternoon. Seven chairman Kerry Stokes and fellow director Peter Gammell have criticised the WAN board as inadequate, citing falling newspaper circulation and revenue. WAN's larger institutional investors have not indicated their intentions ahead of the extraordinary meeting. Page B1. -- BHP Billiton chief executive Marius Kloppers has dismissed Rio Tinto's argument that BHP's petroleum business is too small to successfully integrate with Rio. 'We think that at US$115 a barrel oil...anyone with a pencil can work out that this is a wonderful business,' Mr Kloppers said yesterday. BHP's 3.4-for-one scrip offer for its Australian rival valued Rio at A$144.22 a share on Friday, compared with Rio's closing price of A$139.94. Page B1. -- QBE Insurance Group's (QBE.AX: Quote, Profile, Research) A$7.6 billion takeover bid for Insurance Australia Group (IAG.AX: Quote, Profile, Research) is not enough for a company with 'tremendous market share in Australia,' says IAG chairman James Strong. Mr Strong said IAG's expansion into the United Kingdom was progressing well and 'we're...going to push on with other aspects of our strategy in Asia.' Australia's largest home and motor insurer rejected QBE's takeover bid last week as 'totally inadequate.' Page B3. -- Leading forecaster Access Economics says Federal Labor will need to deliver extensive cuts in the May budget to avoid further interest rate rises. With the Government promising A$30 billion in tax cuts, 'one family's tax cut and middle-class welfare is another family's mortgage rate rise,' Access Economics director Chris Richardson warned. Mr Richardson said every A$3 billion the Government saved could translate to a 0.25 percent cut in interest rates. Page B3.