February 5, 2012 / 8:06 PM / in 7 years

PRESS DIGEST-Australian Business News - Feb 6

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)

Orbis Investment Management, the largest shareholder in PaperlinX, is pondering whether to support fellow shareholder Andrew Price in the latter’s attempt to become the paper manufacturer’s executive chairman. Simon Mawhinney, portfolio manager of Orbis, which owns 18.2 percent of PaperlinX, said “when a seemingly talented entrepreneur buys a large amount of shares and wants board representation, it would be foolish to not entertain the idea”. Page 14.

Clive Palmer has revealed that he is mulling over an offer from ExxonMobil for the rights to explore his gas deposits in Papua New Guinea. Chinampa Exploration, a subsidiary of Mr Palmer’s Mineralogy firm, holds offshore exploration licences in the Gulf of Papua covering more than 43,000 square kilometres. “This project could be bigger than the North West Shelf - it’s the most significant thing we’re doing at the moment,” Mr Palmer said. Page 14.

Hancock Coal, the resource explorer owned by billionaire Gina Rinehart, has declared that its A$8 billion Alpha Coal joint venture with Indian firm GVK will not be postponed by Clive Palmer’s planned lawsuit against haulage group QR National. Mr Palmer, Adani Group and Hancock Coal and GVK are developing projects worth A$23 billion in Queensland’s Galilee Basin. Page 14.

The Australian Competition and Consumer Commission’s decision to allow Japanese brewer Asahi to acquire Mountain H2O, the only national supplier of private-label bottled water in Australia, has been labelled “inconsistent” by the beverage sector. “I thought it was amazing that this acquisition went through without any request for comment from the industry,” Peter Gadsen, general manager of the Australian Beverage Enterprises Cooperative Society lobby group, said. Page 15.

THE AUSTRALIAN (www.theaustralian.com.au)

Consolidated Press Holdings, the media investment group owned by billionaire James Packer, has posted a jump in profit to A$175.2 million for the year to June 30 after the company sold off more than A$300 million in assets. The conglomerate also recorded a jump in dividend income from its media and gaming investments to A$119.7 million, up from A$74.4 million the year prior. Page 19.

Todd Elmer, foreign exchange strategist at global financial conglomerate Citigroup, yesterday predicted that the Australian dollar’s value would not climb beyond US$1.20 because “markets are far too complacent on risks”. Some observers have predicted the local currency to soar beyond US$1.20 if central banks around the world follow recent moves by speculators to invest in the A$. Page 19.

Australian-listed mining explorer Extract Resources is set to receive a A$2.2 billion bid from China Guangdong Nuclear Power Corporation, which recently acquired 89.5 percent of Extract’s major shareholder, Kalahari Minerals. The takeover offer was automatically triggered under a directive by the Australian Securities and Investments Commission, with the Chinese firm due to file a bidder’s statement regarding Extract by the beginning of March. Page 19.

Professional services group KPMG has revealed that the value of merger and acquisitions in the mining sector last year soared by approximately 50 percent on the year previous to reach US$100 billion, with 11 deals worth more than US$1 billion occurring in the last quarter of 2011. The largest recorded deal was a C$3.5 billion transaction including the repayment of debt by Polish copper producer KGHM for Canadian rival Quadra FNX Mining. Page 20.

THE SYDNEY MORNING HERALD (www.smh.com.au)

The combination of giant crops, a 20 percent drop in land prices across Australia and recent rains has led investment funds to purchase local agricultural assets. According to real estate group Colliers International, at least four funds are looking to acquire A$1.6 billion of property in Australia. “I am bullish on all agriculture, everything from sugar to rice, to wheat to corn,” Jim Rogers, advisor to the Laguna Bay Pastoral fund, said yesterday. Page B1.

Darren Olney-Fraser, the new chief executive of Mariner Corporation, yesterday said the investment holding company wanted to emulate the success of peer Guinness Peat Group. “For the last 10 years or so, there has been too much investment in structuring and financial services,” Mr Olney-Fraser said, with Mariner set to invest A$3.2 million into stakes in Capilano Honey, Tasmanian Pure Foods, Peanut Company of Australia and Farm Pride Foods. “We like food  it’s tangible,” the chief executive added. Page B2.

One analyst has suggested that should the proposed merger of global miner Xstrata and commodities trader Glencore International proceed, the new entity could takeover a substantial Australian target, such as the merged body of Aston Resources and Whitehaven Coal. Marc Waha, lawyer at Norton Rose said Xstrata and Glencore could take a year to acquire antitrust approvals, which could be necessary in countries like Australia where Xstrata has clients or assets. Page B3.

Diversified insurer Suncorp will open a flagship branch in Sydney’s central business district this morning . Danny Robinson, Suncorp’s executive manager for New South Wales, yesterday said the company’s client base had increased by 40 percent over the last two years. Westpac Banking Corporation currently has the largest network in Australia with 1257 branches, while Commonwealth Bank of Australia and Suncorp have 1019 and 212 respectively. Page B5.

THE AGE (www.theage.com.au)

Investors are gearing up for a round of profit releases this week, with Macquarie Bank, Telstra, Tabcorp , Rio Tinto and BHP Billiton set to report back to the market over the next five days. “We’ll start to get a pretty good picture with some of those major reportings coming through, as to what the real state of corporate Australia is,” Michael McCarthy, strategist at contracts for difference provider CMC Markets, said yesterday. Page B1.

A study by Rice Warner Actuaries has found that the Gillard government’s proposed reforms to the financial advice sector will increase Australians’ superannuation by A$130 billion over the next 15 years. Industry Super Network, the representative body for the sector, yesterday used the report to criticise claims from the for-profit industry that 35,000 financial services jobs would be lost if the reforms were implemented. Page B1.

The Coalition will question Foreign Minister Kevin Rudd tomorrow if the Federal Government’s support to two Australian executives in Dubai facing bribery allegations was compromised by Australia’s attempt to gain a seat on the United Nations Security Council. The Liberals’ Michael Ronaldson and Helen Kroger placed the question on notice, along with other queries as to whether Mr Rudd received any benefits from Sunland Group Limited, the developer accusing the two Australians of impropriety. Page B3.

The owner of the Rusty Compass website, Mark Bowyer, has won a battle against Google after the online giant decided to suspend his AdSense advertising account. Google found in December that the online travel site “posed a risk of generating invalid activity” and opted to withhold the site’s ad revenue. Mr Bowyer appealed the decision unsuccessfully to Google, forcing him to lodge a complaint with New South Wales Fair Trading. The online search engine last month reinstated Mr Bowyer’s account and A$131 in ad revenue. Page B3. —

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