Hugh Killen rumours unsettle the herd at AACo; Canaccord’s rethink; and Jane Halton’s healthy portfolio

AACo chief executive Hugh Killen. Picture: Naomi Jellicoe

Here’s a juicy morsel from, of all places, the world of prime Australian beef.

Rumours from the C-suite at the Australian Agricultural Company have reached Margin Call, but by the sounds of things we were not the first with the ­intel.

We hear that directors at the 200-year-old agricultural company, who are led by Donald McGauchie, were so alarmed at rumours the cattle outfit’s chief executive, Hugh Killen, was having an office affair that they decided to raise it directly with the man himself last month.

Killen, 52, has been managing director and CEO of what is Australia’s biggest cattle company since February 2018.

AACo owns and operates Australia’s largest cattle herd with about 340,000 head spread over its properties across Queensland and the Northern Territory.

Company sources told Margin Call that the delicate issue was raised at a meeting of directors – informally – as well as with Killen, who strongly denied the allegations.

Former Labor prime minister Kevin Rudd’s daughter Jessica Rudd is also on the AACo board.

Fuelling the rumour mill was the extended period Killen, who was born in Narrabri, has spent in the US.

Others have suggested this was as a result of the trade war that Australia finds itself in with Beijing and which has killed deals in China.

A spokesman for AACo said the company was aware of the ­allegations against Killen and that they had been addressed.

“When the matter was raised the company followed appropriate and expected steps,” the spokesman said.

Before AACo, Killen had spent almost 30 years in the banking industry.

He joined the cattle company from Westpac, where he was leading its fixed income, currency and commodities business.

The new boss had never run an agricultural operation and never been a CEO, but the Killen family has links to grazing assets spanning southern NSW and the Northern Territory.

Killen was a student at Sydney’s The Kings School at Parramatta, in the city’s west, in the 1980s and a Harvard Business School graduate.

Killen is married to Andrea Killen, an interior designer, and the couple have two children, Will and Tess. The family sold their Hunters Hill home in mid-2020 for $7.75m.

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Canaccord’s rethink

What is it that they say about the sanitising effects of sunlight?

At the successful Australian outpost of investment banking shop Canaccord Genuity, its newly introduced practice of enhanced specific disclosure around potential conflicts of interest is coinciding with some pretty interesting research reports.

Following intervention by corporate watchdog ASIC, Canaccord is now explicitly disclosing shareholdings in or investment banking fees set to flow from companies on which it issues research.

This week the financial services house via its analyst Benn Skender punched out a note on tech microcap Bill Identity, which is chaired by former Foxtel boss and now ABC deputy chair Peter Tonagh.

Bill Identity chair Peter Tonagh. Picture: AAP

Other Bill Identity directors include heavy hitters such as former Kerry Packer right hand man Geoff Kleemann and group head at Afterpay Touch, David Hancock.

Bill Identity on February 24 released the details of a strategic review of its operations as well as the company’s first-half trading result, which prompted Canaccord to issue a fresh research report on the group.

Canaccord had previously recommended the company as a “speculative buy” with a price target of $1.15 a share.

But in a note dated March 9, Canaccord – along with disclosure that it owned more than 1 per cent of Bill Identity’s issued capital and intended to seek or expected to receive compensation for investment banking services from Bill Identity in the next three months – revealed a dramatic change of heart towards the company.

Bill Identity, Canaccord now decided, was worthy of only a “hold” recommendation with a target price of a mere 10c a share.

That’s a mere 91 per cent downward shift in perspective.

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A healthy portfolio

Former top-ranking public servant turned high-profile company director Jane Halton looks to be having trouble cutting the apron strings that tie her to the federal government.

Or maybe it’s the other way around, with Scott Morrison’s Department of Prime Minister and Cabinet seemingly unable to live without Halton’s services.

Illustration: Rod Clement

The latest is an extension to the end of this year of one of the contracts that the also Crown Resorts and ANZ bank director has with the PM’s department.

Halton, a former health department head, has been assisting Morrison on his government’s response to the Covid-19 pandemic.

Under a contract first entered into with Halton for “management advisory services” in May last year, she was being paid $98,000, but now that contract has been extended to the end of this year and doubled in value to $198,000.

There was also another three-month contract with the same department for the same type of services for which Halton got $93,000 for three months’ work.

At Crown in the 2021 financial year Halton got about $350,000 amid a tumultuous year for the group, and at ANZ she gets about $330,000 a year.

We think that’s what you call a successful portfolio career.

Hugh Killen

Canaccord Genuity, Peter Tonagh

Jane Halton