Bill Shorten sweet as Labor Club pokies rake it in
Gaming billionaire James Packer, private equiteer Scott Bookmyer and retailer Brad Banducci have much in common with prime minister-in-waiting Bill Shorten.
All four have a passion for the pokies.
For Packer it’s via his $4 billion stake in Crown Resorts.
For local KKR boss Bookmyer it’s a fledgling love affair with gaming revenue thanks to his Australian Venue Co’s new $200 million joint-venture deal with Coles to run the newly listed retailers’ pokies and pubs business.
And for Woolworths boss Banducci, his ALH pubs joint-venture with billionaire Bruce Mathieson means the odd couple is the biggest pokie operator in the land.
Opposition Leader Shorten isn’t quite in that league, but the ALP-owned Canberra Labor Club, which has four licensed club venues in the ACT, last financial year pulled in almost $25m in pokies revenue as part of total revenue of $31m, about steady on the previous year.
According to the Labor Club’s most recent accounts — seen by Margin Call — the outfit has net assets of $59m and has more than $3m cash in the bank. All healthy balances in a federal election year.
The group made a bottom-line profit of a bit less an $1m.
The Labor Club — a lucrative not-for-profit — “donates” money to the ALP through the party’s investment vehicle, the 1973 Foundation Pty Ltd, which was set up to put distance between the party and the club group.
The foundation, which the Australian Electoral Commission considers to be an “associated entity” of ACT Labor (as Vapold Pty Ltd is to the Liberal Party in Victoria), also owns commercial property at Five Dock in Sydney’s inner west that is rented to listed childcare operator G8 Education.
1973 Foundation — whose directors Annette Ellis, Rosemary Follett, Roberta McRae and Karin Macdonald are all former Canberra Labor politicians — also has a share investment portfolio that is managed by JB Were and recently cashed in more than $500,000 worth of units it controlled in a Melbourne commercial property trust.
In the 2018 financial year, the Labor Club does not appear to have made any donation to the party’s 1973 Foundation.
Expect that to change in the 2019 accounts, which will be released after Shorten’s costly showdown with Scott Morrison’s Liberals in May.
Perpetual motions
There have been a flurry of changes in listed fund manager Perpetual’s substantial holdings.
After the market closed on Wednesday, Perpetual told the ASX it had reduced its holdings in energy outfit Viva Energy Group (from 13 per cent to 11 per cent), logistics business Qube (from 8.6 per cent to 7.4 per cent), almond grower Select Harvests (from 9.3 per cent to 7.4 per cent), Solomon Lew’s listed vehicle Premier Investments (from 13.5 per cent to 11.6 per cent), coal digger New Hope (from 7.5 per cent to 6.2 per cent), cinema, hotel and resorts firm Event Hospitality and Entertainment (from 13.2 per cent to 11.1 per cent), aged-home owner Estia (from 14 per cent to 11 per cent) and a reduction of its holding in plumber Reece such that it is no longer a substantial holder (that is, to less than 5 per cent).
Eight stocks, across the ASX, all sold off.
Naturally it led to speculation that Perpetual — now under the management of Rob Adams — had lost another big mandate.
Margin Call can confirm that’s exactly what has happened. “A client has withdrawn an Australian equities mandate,” a Perpetual spokesman confirmed to Margin Call.
It’s tough out there in active fund manager land.
Drummond firms
Medibank Private boss Craig Drummond sure looks well prepared for his expected call-up from the National Australia Bank board to take over as the bank’s next chief executive.
Acting CEO Phil Chronican, 62, already a non-exec director on the NAB board, is having to travel from his harbourside mansion (and local Fitness First) on Sydney’s north shore to steer the troubled financial institution while it looks for a new boss.
When he succeeds Ken Henry as NAB’s chairman, Chronican — who owns almost $800,000 worth of the bank’s shares (more than anyone else on the board) — can steward the bank from afar rather than flog himself in what he reckons is a 70-hours-a-week gig.
By contrast, 57-year-old Melbourne-resident Drummond’s commute to the top office of the disgraced big four from his luxury home in East Melbourne would remain virtually unchanged.
NAB’s Docklands headquarters is right next door to the Elizabeth Alexander-chaired Medibank. (We even hear some of the private health insurer’s staff pop over to NAB’s superior cafe.)
Drummond, who was a Merrill Lynch and Goldman Sachs exec before he joined the NAB executive in 2013, has carved out a CEO-style life in the southern capital.
With wife Bernadette Drummond, he lives right across the road from the MCG, after buying a historic terrace in 2013 for $5.78m.
In August 2016, the month after he got the top job at Medibank, ownership of the home (which has no mortgage) was transferred into Mrs Drummond’s name only, with consideration comprising “natural love and affection”.
Ain’t love grand.
The Drummonds also have a mighty holiday house right on Portsea back beach for which they paid $4.1m in 2005. The home was also transferred into Bernadette’s name just as Drummond took over at the health insurer.
And broadening his Victorian credentials — non-existent on NAB’s board, currently without a single director based in the state in which it is headquartered — he’s a director of the AFL’s Geelong Football Club.
All set up for the next phase.
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