EY’s corporate undertakers received a knock at the door from the regulator on Thursday with some light questions over its appointment as administrator of downed airline Regional Express.
“We are engaging with EY to understand the terms of their engagement,” a spokesman for the Australian Securities & Investments Commission told Margin Call.
ASIC’s finest cardigans are apparently trying to figure out if there’s any conflict with EY’s appointment, given they were brought in by Rex to conduct an independent review of the business as early as May. For that they were paid $520,000, and currently there’s no suggestion anything’s amiss. Inquiries, as they say, are continuing.
ASIC’s probing might end up being routine but the rules are the rules and the facts are the facts: external administrators are supposed to be independent of the company and the directors they’re assisting.
With that in mind, consider that EY’s restructuring lead Adam Nikitins, now the administrator, was in the tent with Rex and its investors three months ago and attended basically every meeting up until late July. In that time, discussions shifted from a mere appraisal of the business and a couple of management calls to an escalation with Rex directors around the matter of voluntary administration and “contingency planning”.
EY’s counterargument to any conflict, filed in paperwork to ASIC on Thursday, is one that goes out of its way to assure the regulator that the advice was limited enough to maintain its independence. By its own admission the firm planned for the “possible appointment of an administrator” and held meetings with directors. “Our work was undertaken for the companies only. We did not provide any advice to the directors.”
Hard to be sure, especially when Nikitins was in the room when it happened.
Late on Thursday, EY said their engagement with ASIC was entirely expected for an administration “of this size and this level of community interest”.
Metro mania
The long-awaited Sydney Metro was supposed to be unveiled this weekend were it not for a paperwork snafu with the national rail safety regulator. Or so went the excuse from Labor Transport Minister Jo Haylen, who announced on Tuesday that the project was “99 per cent complete” but needed to clear a handful of safety exercises before the trains could finally go choo-choo.
Meanwhile, the NSW Liberal Party has made a bizarre decision to go ahead with a celebratory drinking session that its leaders had planned to hold in honour of the metro line’s opening – even though that isn’t happening anymore.
“The Metro would have opened under the Liberals. Our event is going ahead even if Labor isn’t!” said an email from the office of deputy leader Natalie Ward, obtained by Margin Call. “When we say we will do something on 4 August, we do it.”
Their commitment to keeping a day-drinking appointment is to be admired, clearly. Tickets to this faux-fundraiser at a pub in North Sydney are priced at $80 per person, with opposition leader Mark Speakman and former premier turned BHP inveigler Dom Perrottet scheduled to appear.
Meanwhile, speaking of the Metro, straphangers are sure to notice a difference between the Martin Place station and the rest of the rail line. Macquarie has paid for 12 pieces of art – stainless steel sculptures and brass baubles – to be displayed in the CBD atrium, conveniently below its offices. Elsewhere, however, we hear the government applied pressure on the project to nix the frills. Tale of two cities? Wasn’t that Labor’s line against Perrottet during the pandemic?
Small world
Slip of the tongue, surely.
Thomas Goodhead leads Pogust Goodhead, a pumped-up class-action law firm that sailed into Sydney earlier this year backed by a $1bn war chest, its mission to chase booty from local multinationals.
In May, Goodhead conducted an interview with Patricia Karvelas on Radio National about a $55bn class action being led by his firm against BHP over the 2015 Mariana Dam collapse in Brazil (which saw 19 people killed and much toxic waste released.)
In the midst of that interview, Goodhead cited another matter being pursued by the firm in South America. “We’re looking at a case at the moment in Colombia, where BHP and Anglo American … have been involved in some terrible environmental consequences associating (sic) with the Cerrejon open pit coal mine project.”
Goodhead neglected to mention in that appraisal of Cerrejon that a third company – Glencore – was deeply involved in that project. Glencore operated the mine in a long-running joint-venture with BHP and Anglo-American but ended up acquiring their 33.3 per cent interests in the site, respectively, in 2022.
And Glencore Australia, it turns out, happens to be repped by the same lobbying outfit engaged by Goodhead’s firm in Australia. Labor-whisperer Evan Moorhead and his Anacta Strategies have been on the books for Glencore since 2022 and for Pogust Goodhead since April 2023. Can’t trash a stablemate, right?
Could it be that BHP and Anglo-American were given the blowtorch in that interview while Glencore was deliberately given a pass? We wouldn’t be so cynical.
And yet, another wrinkle for Anacta arises – this time out of Western Australia, where its operations are led by Labor true believer Mark Reed. He’s an ex-lieutenant of former Labor premier – and shadow lobbyist – Mark McGowan, who’s been hired as a consultant for BHP.
Remember, BHP is the miner being sued by Pogust Goodhead, a circumstance that thereby pits McGowan against his protege, Reed, at Anacta. A tangled web of Labor hacks. It’s not like WA isn’t small enough already.
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