Hijinks, the high life, and the banks copped a good bashing

Illustration: Rod Clement.

Was it really only a year ago that Kerry Stokes’s Seven West Media boss Tim Worner was thrust into a workplace sexual harassment scandal, whose tone and content would define the Australian and international corporate landscape for much of 2017?

What began as a nuclear attack by former Seven executive assistant and Worner’s one-time mistress Amber Harrison has grown from trickle to flood all over the world and back again.

To be clear, Worner wasn’t involved in Harvey Weinstein behaviour, but he ended up as something of a local forerunner for the public shaming of the Miramax boss and the likes of Hollywood actor Kevin Spacey, NBC news anchor Matt Lauer, mostly forgotten scalps at Gillon McLachlan ’s AFL, and veteran TV presenter Don Burke. Just before the year ended came a claim against Melbourne Lord Mayor Robert Doyle, which he disputes.

And there’s no end in sight as newsreader turned activist Tracey Spicer processes her local sexual misconduct file.

Who next in 2018?

Media merry-go-round

The handling of Tim Worner’s extramarital workplace affair saw Gilbert + Tobin partner Sheila McGregor off the Seven West board, but now Worner continues in Seven’s top office.

His contract runs until July 1 next year. It may be extended.

Illustration: Rod Clement.

Seven enjoyed its 11th consecutive annual ratings victory this year, albeit by a whisker on the main channel to Hugh Marks’s Nine, as some speculate that Kerry Stokes and scion Ryan would prefer to offload the bulk of their media assets — all the better to focus on the tractors, oil and other assets in their ascendant Seven Group.

This year saw Communications Minister Mitch Fifield heroically bring about media law reform, but to little effect so far.

Will 2018 be the year when the much discussed deals finally ­happen?

Greg Hywood’s slimmed-down Fairfax remains in the mix after Joel Thickens’ TPG decided against buying the publisher before Antony ‘The Cat’ Catalano got his own listed plaything in Domain. All the while CBS’s Armando Nunez settles into life running Ten after winning control of the network in receivership.

But it all pales in comparison with Rupert Murdoch’s$68.3 billion 21st Century Fox deal with Disney last week. Into 2018, look to the merging of News Corp with the new Fox. It makes a lot of sense, although it could be a while in the making.

High-rise Harry

There was no deal bigger in Oz than 87-year-old Sir Frank Lowy’s $33bn agreement to flog the giant Westfield group to Christophe Cuvillier’s Unibail-Rodamco.

The big-spending Belgian-born property boss is set to visit our shores after Australia Day to pitch the combined behemoth to Westfield investors.

Cuvillier’s late-night signing of the deal on the tarmac in Paris in Lowy’s private jet begs the question: what about Lowy’s fellow ­octogenarian rich-list property rival, Harry Triguboff?

Could 2018 finally be the year Sydney-based Triguboff pulls off the much-mooted (at least by Harry) sale of the Triguboff Meriton apartment empire?

Back in 2014, Triguboff said he’d been made an offer by a Chinese property developer that would have netted him
$3bn for half of the business. A few months later, that price had shot up — like a Meriton serviced apartment — to $10bn for the whole empire.

By 2015, the price was tottering at $15bn.

Billionaire ‘High-rise’ Harry Triguboff. Picture: Hollie Adams.

“If I sell Meriton, I could get $12bn to $15bn easy,” Triguboff told The Weekend Australian.

He’s not nicknamed “high rise Harry” for nothing.

Meanwhile, the snags have been cleared for UBS boss Matt Grounds, investment banking chief Kelvin Barry, equity capital markets boss Andrew Stevens and contemporaries Peter Scott from Gresham, Premier director Tim Antonie and Stratford Advisory’s Quentin Miller’s $30 million development of the Mernda Junction Shopping Centre, the investment banker-turned-property developer group’s second side project of its type.

After legal action early in the year with the group’s original builder halted work, the Hacer group is now full tilt on the development, which is expected to be finished in time for next Christmas.

Mosman rockstar Grounds, along with former UBS colleague David Di Pilla, also has a hand in the rapidly expanding Aurrum Aged Care group, as well as the redevelopment of the former Masters property assets now rebadged as Home Consortium large format shopping centres, which opened its first site in November.

The group, also backed by Zac Fried and Morry Fraid, who own the Spotlight and Anaconda chains, along with the owners of Chemist Warehouse chain Mario Verrocchi and Jack Gance, will continue to open new, bulky stores next year. Other corporate options, including a float or the addition of a new capital partner, are also being explored.

All, no doubt, with the help of Grounds’ UBS.

Bash the banks

Banking will continue to be the most punished sector in corporate Australia, as former High Court judge Kenneth Hayne trawls through the industry, once again, this time in the form of a royal commission.

There will be little in the way of festive cheer for the special units established in each of the four pillars to manage the demands of the commission, after Hayne this week wrote to institutions demanding their response to a series of
wide-ranging questions by no later than January 29.

Merry Christmas!

With our colleague Richard Gluyas revealing that the commission will be held in Melbourne, where Hayne, NAB and ANZ are based, this will mean a lot more travelling for the Sydney-based executives from Westpac and CBA. Next to be secured are premises for the commission’s secretariat and more staff, for which are now being recruited by Christian Porter’s Attorney-General’s Department.

After a several-week search, the role of counsel assisting the commission has gone to Melbourne silks Rowena Orr and Michael Borsky. January is also expected to see Hayne clear up any conflicts of interest he may have in his role as commissioner.

The 72-year-old is the owner of an historic terrace in East Melbourne that has been mortgaged to Brian Hartzer’s Westpac since 2006.

CBA former heir apparent Matt Comyn. Picture: James Croucher.

Commonwealth Bank chair Catherine Livingstone won’t rest over summer either, as she continues the search for CEO Ian Narev’s successor in the new year.

Banking orthodoxy says the chosen one will come from outside the troubled institution following the Austrac scandal, which would rule out former heir apparent Matt Comyn. But then again, Livingstone isn’t much troubled by the wisdom of the crowd.

Illustration: Rod Clement.

Executives at CBA’s big four counterparts will continue to jockey to be in position for the next handover, although none are expected in the new year.

That should give digital chief Maile Carnegie and CFO Michelle Jablko at Shayne Elliott’s ANZ, consumer bank boss George Frazis at Westpac and former NSW premier Mike Baird at Andrew Thorburn’s NAB more time to establish their credentials.

All the while, the big four will continue to prune their numbers by the thousands, none more proudly than at Thorburn’s NAB, which this year got weirdly excited about its redundancy program, “The Bridge”.

Moore on the move?

Nicholas Moore’s Macquarie Group may, for another year, threaten to relocate to Singapore. It won’t.

Elsewhere in financial services, we look forward to the ascent of QBE exec Pat Regan into the top office at the troubled insurer come January 1 following the exit of John Neal after a frisky past year at the helm.

Neal leaves QBE with a new relationship with Lucy O’Reilly, the former personal assistant to the group’s board.

Illustration: Rod Clement.

That office romance, or rather its tardy disclosure, saw chairman Marty Becker dock the outgoing chief Neal’s bonus by $550,000.

It’ll now be up to Regan to placate the insurer’s hostile institutional shareholder base.

My oh Myer

Embattled Myer chief executive Richard Umbers and his impatient new chair Garry Hounsell will turn to Goldman Sachs’s Christian Johnson and Flagstaff’s Tony Burgess for wise counsel in 2018 as streetfighting retail billionaire Solomon Lew amps up his campaign against the shrinking department store group.

Myer CEO Richard Umbers. Picture: Aaron Francis.

Umbers’ profit warning a week before Christmas vindicated Premier chairman Lew’s “summer is coming, the numbers won’t lie” prediction at the start of December.

That followed Myer’s annual meeting the month before, when Paul McClintock shuffled off after five years as chairman, as Hounsell affirmed his commitment to Umbers’ “New Myer” strategy.

Myer hurtled to Christmas with its shares hitting a record low just above 60c and its market cap down to $513m, a mighty fall from $2.4bn when the group was floated in 2009 out of the then Ben Gray-run private equity shop TPG.

Myer’s value is now far less than the $738.85m tax bill that TPG was hit with in 2009 following the bumper float, after the private equity group had controversially and quickly moved the offer proceeds offshore.

The tax office was ultimately unsuccessful in its tax grab, but the smell still hangs over the increasingly crowded local PE industry.

The first quarter of the new year is expected to bring a request from Lew’s Premier — run by former David Jones boss Mark McInnes and which owns 12 per cent of Myer — for an extraordinary general meeting of Myer shareholders, where the billionaire will request a spill of the entire Hounsell-led board and the installation of his own suite of candidates.

Look for movement, too, from the corporate regulator (which come February will be led by incoming chief and former Goldman Sachs banker James Shipton) ahead of Myer’s interim results on the carrying value of the retailer’s intangible assets, which are now almost double its market value.

How long can Umbers and his “New Myer” strategy survive as investor brace for a writedown and trade continues to decline?

And what about a wedding come 2018 for old romantic Solly, who got engaged to his partner Roza Prappas early this year?

New squeeze

New love looked to flourish at the tail end of the year for gaming billionaire James Packer after an extended period in hibernation following the acrimonious end to his engagement to his Fantasy fiancee Mariah Carey.

Packer, who turned 50 in August, spent much of the year surrounded by close mates at his Ellerstina luxury polo ranch outside Buenos Aires in Argentina, from where he ordered the flogging of private assets and those of his Crown Resorts to pay down billions in debt.

By Christmas, Packer looked happy to be snapped stepping out in Aspen, Colorado (where he has a home with former wife Erica Baxter) with his new Canadian model girlfriend Kylie.

The year ahead will see Packer continue to live offshore — he calls Aspen home, at least on his ASIC paperwork — as his John Alexander-led Crown continues to cut costs and do away with non-core businesses, including its 62 per cent stake in CrownBet.

After 14 months of struggle, the new year will also bring the full-scale implementation of Paula Dwyer’s $11bn merger of Tabcorp and Tatts, as the market in mid-December ceased trade in Harry Boon’s wagering group.

The emergent gaming powerhouse will be in the mix for the potential privatisation of the West Australian TAB, with WA Labor Premier Mark McGowan preparing to receive Investec’s scoping study on a mooted $500m-plus sale process early in the new year.

Expect Kerry Stokes’s
Seven-Racing Victoria joint-venture Racing.com, which has the rights to broadcast Victorian racing and from Hong Kong, to also play a part in any sell-off as he seeks to build his wagering assets.

She’s rolling in it

Hancock billionaire Gina Rinehart was this year restored to the top of the Forbes richest Australian list, with a fortune valued at $21.5bn.

That will probably be replicated on the local rich list in 2018 (which would see her take the crown from Visy’s Anthony Pratt), as her Roy Hill mine continues to ferry iron ore to China after its historic first shipment last year.

The new year could herald the first shipment of Rinehart and her Chinese billionaire Gui Guojie’s Kidman cattle to the Middle Kingdom. That is the live animal venture that so upset her Perth billionaire rival Andrew Forrest.

Gina Rinehart rings the tills at $21.5bn, and counting.

Any cattle ceremonies would have to be arranged around the Gold Coast Commonwealth Games in April. As patron of the Australian swim team, Rinehart is not going to miss that gold fest.

Also pencilled in the Rinehart diary is the arbitration of the multi-billion-dollar trust dispute with her son John Hancock and daughter Bianca.

However, those familiar with the case won’t be surprised if that family feud is kicked into 2019 following an appeal by the kids (and their fee-hungry lawyers).

Me and the missus

Real estate will continue to interest observers of Jean-Sebas­tien Jacques’ Rio Tinto. Rio has indicated it is looking to add a new corporate office in Sydney to its international suite.

That would be a handy complement to the $3m apartment in Sydney’s Walsh Bay that JS and wife Muriel Demarcus picked up this year.

Down in Melbourne, JS’s offsider at BHP, Andrew Mackenzie,and the Big Australian’s relatively youthful chairman Ken MacKenzie will continue to operate under the intense scrutiny of New York billionaire Paul Singer’s hedge fund Elliott Management, which had the miner on the backfoot for much of this year.

The Elliott activists will continue to take a keen interest in BHP’s promise to exit its unloved US shale oil and gas.

No doubt we’ll be hearing more from them on that subject — either to take the credit for any sale or to hurry one along.

Politico ho ho!

And finally to politics, which has continued to be a turbulent and sometimes deadly game, particularly for elected dual citizens.

By the end of the year, Prime Minister Malcolm Turnbull had racked up his 25th consecutive Newspoll loss, his coalition partner Barnaby Joyce’s Nationals were at each other’s throats, while at least four
by-elections loom in the new year thanks to the citizenship fiasco.

Just another year in Canberra, really.

The forgetful and somewhat disordered Labor Member for Batman David Feeney, who can’t find his citizenship paperwork, has an eventful year ahead.

Illustration: Rod Clement.

Will the diminished Victorian Labor powerbroker manage to get his new home built in Melbourne’s Northcote (the $2.3m one he forgot about until 2016) ahead of any vote he may face?

If his expected showdown with Richard Di Natale’s Greens goes pear-shaped, perhaps he and his Maurice Blackburn lawyer wife Liberty Sanger will move back into their luxury apartment in East Melbourne, which they vacated after it was revealed they were living outside Feeney’s electorate.

Further north, will freshly re-elected Member for Bennelong John Alexander manage to find a new home in his electorate, having last year sold his Putney residence after moving into his partner Debbie Chadwick’s
$5m home overlooking the ocean 30km away in North Bondi?

Meanwhile, his Labor rival Kristina Keneally will spend the summer contemplating her political future, potentially opting to contest Bennelong again at the next federal election. Otherwise, she can take the much easier route to Canberra: the NSW Senate slot to be vacated by Labor’s lapsed boy wonder Sam Dastyari.

The southern trio, Victoria, South Australia and Tasmania, all have state elections in 2018.

Former senator Nick Xenophon’s SA Best party looks to have cruelled Liberal leader Steven Marshall’s chances of governing alone after the March poll. Amazingly, Xenophon’s surge could see Jay Weatherill’s 16-year-old Labor government returned for another four years. And a Xenophon-led minority government isn’t impossible.

By comparison, Tasmanian Premier Will Hodgman’s contest (to be held by no later than May 19) looks humdrum.

And at the end of the year, Victorian Premier Dan Andrews is well placed to follow Anna Palaszczuk’s Queensland example and return his government to power at the November election.

Helping Andrews is president Michael Kroger’s squabbling Victorian Liberal division. The Liberals’ legal battle with their erstwhile biggest donor the Charles Goode-chaired Cormack Foundation is due to be heard in the Federal Court in March.

A fortnight ago, the Prime Minister said he would prefer the family feud was sorted out privately before then.

Seems that opportunity has long since passed.

Over and out

To all our readers, have a happy and relaxing festive season.

See you in the new year.