Where next for RBA Guv’nor Glenn Stevens?
The Festival of Glenn Stevens was held last night at the Museum of Contemporary Art to toast the outgoing governor of the Reserve Bank.
The gathering, which looked over the Sydney Opera House, was held hours after Stevens’ final RBA board meeting. Fittingly for a man who fetishises predictability, the governor left the cash rate unchanged at 1.5 per cent.
Stevens’ 10 years in charge of the RBA officially ends on September 17. Then he will be replaced by the deputy governor Philip Lowe — a succession as dull as the governor could have dreamt.
Then what for Stevens?
Should he want it, a career as a director on Australia’s blue chip boards awaits, as many at last night’s MCA dinner have long been plotting.
His immediate predecessor as RBA governor, Ian Macfarlane, was previously a director of the now deceased Leighton Holdings and of Ralph Waters’ Woolworths.
Macca, now 70, is still on David Gonski’s ANZ board. He joined the bank almost a decade ago, just five months after stepping down as governor.
Spotting the pair in conversation at last week’s Chief Executive Women’s dinner, some wondered whether Gonski might see in Stevens a worthy replacement for Macca in the not-too-distance future.
That’s assuming Gonski’s not beaten by CBA chair David Turner, Westpac’s Lindsay Maxsted or Stevens’ former RBA board member Ken Henry — the former Treasury secretary, current NAB chair and permanent wombat lover.
Raise a glass
The federal Treasurer Scott Morrison was one of those along at the MCA last night to toasthis fellow Cronulla resident Glenn Stevens.
“Over the past year, our beloved shire became the HQ for Australia’s economic management,” noted Morrison, who is the member for Cook, an electorate that takes in Sydney’s southern beaches.
Morrison also drew attention to Stevens’ work as volunteer pilot for Angel Flight, a charity that delivers medical services to people in rural areas.
“Glenn, despite your claims, clearly you aren’t Sydney’s most boring man!”
Wright takes flight
News just in: George Wright, the departing Labor national secretary, will not deliver the traditional campaign director’s election review at the National Press Club.
It’s the first public complication from Wright’s interesting new role at Andrew Mackenzie’s mining giant BHP, which was announced last week. The low-profile brain behind Bill Shorten’s campaign against the Coalition’s proposed corporate tax cut starts at BHP on October 3.
That leaves Malcolm Turnbull’s man, federal Liberal Party director Tony Nutt, out there on his own — another twist in the strange 2016 federal election. Nutt will take the NPC lectern on September 22.
Talking turkey
Australia’s recent approach to foreign investment appears to have deviated from some of our allies — even some of those in the “Five Eyes” intelligence alliance.
Yesterday, Canada’s ascendant Liberal Prime Minister Justin Trudeau popped in to the Hong Kong headquarters of the conglomerate CK Hutchison to meet its billionaire chair Li Ka-shing and deputy Victor Li.
“A pleasure to work with Li Ka-shing this morning as we discussed Hong Kong-Canada trade and investment,” said Trudeau after the meeting.
No surprise to hear Trudeau didn’t bump into his Australian counterpart Malcolm Turnbull in the lobby.
Less than a month ago the Turnbull government blocked Li’s CK Hutchison and China’s State Grid from buying Mike Baird’s electricity distribution business Ausgrid.
Curiously, the Hong Kong billionaire already owns electricity companies in South Australia and Victoria
Li also owns a majority share of Husky Energy, one of the largest energy companies in Canada. And if Trudeau gets his way, it won’t stop there.
Meanwhile, now that the Chinese and Hong Kongese are struck off, it’s the Canadians who are the hope of the side for Baird.
The Premier’s advisers UBS and Deutsche Bank are now talking ice hockey and regulated asset bases with the Canada Pension Plan Investment Board and Caisse de depot et placement du Quebec as they try to get the Ausgrid sale away in time for next year’s NSW budget.
High tea
It makes you wonder — why doesn’t NSW Premier Mike Baird just hire the Foreign Investment Review Board chair Brian Wilson as an adviser?
And if not Baird, why don’t his advisers UBS and Deutsche? It’s worth a shot. They clearly have no idea how the FIRB black box works.
Until this week, we never would have dreamt of such an arrangement. But then Wilson surprised us by revealing his new gig with the Carlyle Group, as a senior adviser to the private equity giant’s Asian buyout team.
Treasurer Scott Morrison assured us again yesterday that potential conflicts have been flagged, noting that the appointment has been registered with John Fraser, the former UBS executive turned secretary of the Treasury (for now) and the FIRB secretariat.
“I will continue to seek assurances from the secretary that the FIRB process is conducted with the highest level of integrity,” Morrison told us.
It’s unlikely our Baird proposal would pass that test. But you never know.
Wilson adds the private equity role to his board duties on golf victim Colin Bell’s Bell Financial Group.
He is also the chancellor of UTS, the Sydney university that hosts the Bob Carr-headed, Huang Xiangmo-funded think tank that paid for the infamous afternoon tea.
The Treasurer wouldn’t comment on whether Wilson — who was appointed FIRB chair for five years by Wayne Swan in 2012 — would have his duties extended when his term expires next year on April 16.
Also no comment on concerns — entirely fabricated by this column — about Chancellor Wilson’s brazen connection to Carr’s much maligned think tank/afternoon tea society.
Punters on a winner
It has been one of the hottest stocks on the ASX over the past two years, but you’d be forgiven for not noticing. Only one broker covers it.
After years of pain, the recent success of telecoms infrastructure company Service Stream is well known to a bunch of our richie investors.
In 2007, Service Stream raised $22m from Australia’s wealthiest families, including the Gandels, Alex Waislitz’s Thorney Investments, the Myer family and Geoff Wilson’s Wilson Asset Management.
The shares sunk to as low as 12c in mid-2013 as the company battled a bunch of NBN Co contracts that went awry. But since Leigh Mackender took over as CEO at the end of May 2014 they have been on the up. They closed yesterday at $1.05.
Now the richies are cashing in. Who could blame them?
Over the past three months, Gandel, Waislitz and Perth multi-millionaire John Rubino have all sold down their Service Stream holdings. For Gandel, his sale was the first since 2007.
Waislitz sold only 1 per cent late last month after Service Stream’s tidy annual results. His companies still hold nearly 26 per cent of the company.
Part of that is held by his listed Thorney Opportunities Group, which has more than quadrupled its money after buying into Service Stream in a $20m capital raising in early 2014 for 22c per share.
Despite a few bumps, a ride worth taking.
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