Seven and Ten eye switch in sports

Illustration: Rod Clement

Tuesday is the day the $25m cheque from Seven West Media’s James Warburton due to Cricket Australia for its latest broadcast rights instalment is expected not to turn up, as the nasty spat over the value of the deal and the Big Bash League in particular worsens.

But could the network be looking at another sports deal ­instead?

Word is that the also-cash-strapped Network Ten would be keen to offload its Melbourne Cup carnival rights, for which it is paying an eye-watering $20m. And Ten may have quietly ­offered them to Seven as part of its own attempts to mitigate its sports rights costs.

It would make sense given Seven broadcasts the rest of Victoria’s spring racing carnival (the Victoria Racing Club sells the Melbourne Cup separately) and plenty of Sydney racing each Saturday as well. And Seven held the rights until Ten blew it out of the water with a $100m, five-year winning bid in 2018.

Whether or not Ten would want the Big Bash League rights back — it held them for five years — in return is another matter, given the value of cricket rights currently. It has already knocked back a previous offer by Seven for the BBL. And Seven can’t exactly afford to outlay huge bucks for anything right now.

But if Margin Call was a betting person, we’d put a couple of dollars on the Melbourne Cup being back on Seven one of these years. All those gambling ads would help pay some of Seven’s bills at least.

McKeon’s CEO advice

Simon McKeon knows his way around a boardroom, and he never seems to be far from companies that are close to a crisis.

First it was a brief stint chairing AMP, more recently joining NAB as a director, and now McKeon’s directorship at Rio Tinto has been the latest cause for sleepless nights at his North Balwyn home in Melbourne.

But well before last week’s ousting of chief JS Jacques, iron ore boss Chris Salisbury and corporate relations head Sim­one Niven, the former Australian of the Year was already sowing the seeds of his credentials to taking on an enhanced role on the Rio board.

As part of the fallout of Rio’s Juukan Gorge cave scandal, McKeon was on Friday named a senior independent director.

But in a podcast conversation with executive recruitment group Blenheim Partners that was released earlier this month, McKeon opened up about his upbringing in Melbourne’s Dandenong, his regrets about not pursuing a science degree (not that it stopped him from being the chairman of the CSIRO), but most importantly his backing of the “court of public opinion”.

As a director he has some firm words for the CEOs who work in the companies where he sits on the board.

McKeon says he tells them “it is your choice as to whether you want to roll up your sleeves and be a manager, let alone a CEO in a large corporate.

“Whether it’s from an environmental perspective, or good behaviour perspective, and any manager who is not up to balancing that complicated set of competing interests, you just don’t want them,” McKeon tells the Blenheim Partners podcast.

Harsh words to hear in light of the sudden exit of Jacques.

And while he seems to juggle corporate upheaval with ease, McKeon ruled out any foray into the political realm, saying he “doesn’t have the guts”, despite being “asked from all sides”.

Webjet boss’s sell-off

Travel group Webjet has taken a beating in the coronavirus-fuelled rout, and along with it managing director John Guscic.

While the Melbourne-based exec may have come in at fifth in a recent survey of the highest-paid Australian CEOs, with a large portion of his wealth tied up in stock, his riches on paper have taken a hit as the company’s shares are down 69 per cent in the year to date.

In a filing on Monday, Webjet told the market Guscic had sold down his stake in the group by half, netting $21.2m.

Webjet's CEO John Guscic. Picture: Tim Carrafa

But there won’t be any champagne popping for Guscic, who said in a statement that proceeds would be used to partially settle a funding arrangement with UBS, “historically entered into for the purpose of acquiring Webjet shares when they were trading at a significant premium to the current share price”.

“Given the significant impact COVID-19 has had on the global travel industry and value of the company’s shares since acquisition, upon expiry of these funding arrangements Guscic does not consider the cost of extending them to be appropriate,” the company said.

While UBS wouldn’t be drawn on whether the arrangements resembled a margin call, Webjet noted that “none of these funding arrangements include any share price-based triggers”.

The 5.5 million shares sold represent about 1.6 per cent of the company’s issued capital and, at an average sale price of $3.84, equate to a near 50 per cent discount to when Guscic last bought shares on market in October last year.

All his unlisted options in the company are now cancelled, leaving Guscic with a direct interest in roughly $18.6m in shares at Monday’s closing price of $3.97.

Guscic has previously had funding arrangements with UBS and Goldman Sachs.

“Along with the rest of the management team, I remain resolute in my determination to steer the business through what has been a devastating period for the global travel industry,” he said in a statement.

“I remain a long-term, committed shareholder in the business and am encouraged by the significant opportunities for returning to profitable growth when COVID-19 subsides.”

Captions on boards

Those hard of hearing might be used to seeing Ai-Media’s captions on the nightly news, but the accessibility group joins the ASX on Tuesday, and is set to boost co-founder Tony Abraham’s wealth by $34m on its debut.

The Rhodes scholar co-founded the company in 2003 with deaf colleague Alex Jones to improve accessibility and inclusion in the deaf community, and he holds a 19.2 per cent stake through his Perlirose investment group.

Foxtel was the group’s foundation customer and no doubt the meeting ground for now-chair Deanne Weir, who previously served as a senior Austar exec before it was acquired by Foxtel in 2012.

Weir has served as chair of the fledgling accessibility group since August 2013 and will take a $19m stake in the group, while director John Martin, formerly of Babcock & Brown and Primelife, holds a $1.34m stake.

Ai raised $65.5m from investors in its IPO at $1.23 a share, giving it a total market cap of $177.4m.

Proceeds are set to provide the company with access to capital markets to pursue further growth opportunities such as expansion into North America and Asia.