The Sydney Morning Herald from Sydney, New South Wales, Australia • Page 24

BUSINESS The Sydney Morning Herald Monday, July 10, 1995 23 O'Reilly a friend any lawyer would like tfc Am SJfei jem porter ji iff IS I 1 I pv, I-VS vx. 1 i I-, ii iii 'ill ji fcipMrmiriii i mi i iiimni- mi in I linn. mur'- i mriiii-r---- if i mr i Iti finally, the completion of its sale. The sale was supposed to be settled last August but, like everything else associated with the property, which Exicom inherited when it took over AWA's telephone-making business in 1988, things didn't work out. The delay has cost Exicom $200,000 of the S500.000 net gain it expected when it ruled off 1994's accounts, Newman said on Friday.

But that is nothing compared to the $20 million Exicom rote off against the property in the 1991 financial vear, after a sale to an associated group collapsed, and the inordinate amount of management time it has taken up. Besides the collapse of commercial property prices, the sitE turned out to have serious contamination, with asbestos in some of the 46-odd buildings, and heavy metals and cytinide in the soil. Then chiejf executive Bob Cruickshanks told shareholders at last year's annual meeting the problems were so bad, Exicom was lucky to sell the Parramatta Road property at all. As part of the deal Exicom lent Iron Cove Developments SI. 705 million to demolish the buildings and clear the site.

Iron Cove has repaid $920,000 and will pay back the rest within 12 months. Flamboyant move Mr Mortimer Fiat contract a coup. i Hi i 111 .31 seat in driver IAHAT anl f)l I Tony II sued whei lawyer's friend Reilly is. He hen he missed out on buying John Fairfax and now it turns out he sued Goodman Fielder over an aspect of Heinz's purchase of Wattie Industries. Many moons ago one of O'Reilly's Irish tiddlers sued the mighty BHP over a dispute in the North Sea.

What is surprising about the Watties litigation is that O'Reilly has been crowing about that purchase, calling it a "home run" for Heinz. But it seems there's one niggle in the deal relating to an ice cream agency agreement in Japan and O'Reilly has gone to court to sort it out. Heinz has filed an ambit claim against Goodman, which gets a brief mention in Goodman's 1994 annual report without mentioning any names. "Certain controlled entities have received a notice of intention to claim under a share acquisition agreement. The amount has not been quantified in the notice received.

In the opinion of the directors this claim is not sustainable, and the directors propose to vigorously defend the claim." A Goodman spokesman said the case was before the courts in Watties's home base, New Zealand, and Goodman's position is unchanged from last year. O'Reilly's litigious side has had much attention this year, thanks to the hearings and ultimate settlement of the case he brought over the sale of John Fairfax. While O'Reilly's Independent Newspapers got $15 million from the settlement, it is thought to have come out behind. Was it you, Joe? THE run up in the share price of Great Central Mines may have proved too tempting for its boss, Joe Gutnick. Over the weekend the word swept around that Joe could have been the one who had offloaded a line of 12.5 million shares handled by County NatWest on Friday.

This represents close to 5 per cent of the company. The special sale was booked after the market closed and went through at $2.88, a 10 per cent discount to the week's close of $3.20. A number of puzzled shareholders in GCM were reported to have got a bit hot under the collar when the rumour spread seller of GCM shares? i By MATTHEW KIDMAN TNT has substantially strengthened its presence in Europe after securing a Si 00 million logistics contract with the Fiat Auto company over the weekend, boosting its push into one of the strongest growing markets in the transport industry. Under the terms of the contract the Australian transport group will, effective immediately, manage the logistics and distribution of Fiat Auto's spare-parts network in France, Germany, Britain and Spain. TNT already has extensive logistics operations in Europe with major contracts held in The by Joe Gutnick that Joe might been the seller.

Over the past six weeks GCM has easily outperformed the gold index, fuelled by speculation that Western Mining might make a takeover play for the group. Some observers were suggesting that Joe may have shown incredibly astute timing to take advantage of the rumour. Others hinted Joe may have sold out to WMC. It will be interesting to see if a shareholder notice appears this week and Joe's name is attached. It's that airline food.

HE Qantas roadshow through London raised a few eyebrows about the level of interest from the Old Dart when one of the lunches to be hosted by chairman Gary Pemberton and chief executive James Strong was suddenly cancelled. The joint lead managers of the float, Mcintosh Corporate and Swiss Bank's imminent child Potter Warburg, had separate lunches scheduled for last Wednesday and Friday, but the nuation consultants Mercer Asset Planning showed Zurich Managed Growth had the highest return of 37 pooled funds surveyed for the 12 months, ith 10.6 per cent. Ma pie-Brown Abbott PST came in second, ith 10.4 per cent, followed by Tow er Life Mixed with 9.3 per cent. the mystery Sugar pricing war sours MRS coup for the transport group after chief executive Mr David Mortimer identified its logistics operations as a crucial link in TNTs recovery ambitions. Besides Europe, TNT is looking to expand into Asia, adding to its businesses in North America and Australia.

In addition, the new deal will go some way to easing the burden created by its 50 per cent share in Ansett Australia. In the third quarter of this financial year Ansett made a pre-tax loss of $15 million as a result of decreasing margins and the troubles associated with Sydney Airport. This situation looks unlikely to be rectified in the short term, with the economy Mr Harley In May the Trades Practices Commission dealt MRS a hefty blow by closing an inquiry into fitter ORE movements in the merchant banking world, with Matthew Howison opting to leave the hushed, traditional confines of Rothschild Australia for the more flamboyant offices of Malcolm Turnbull's Turnbull and Partners. Howison has had a busy couple of years at Rothschilds, working with Ronnie Beevor and the corporate team on various manoeuvres. The unusual tactic employed by Rothschild during its vigorous defence of Renison Goldfields's bid for Pancontinental Mining buying shares in the target company would have given Howison a taste for Turnbull's operational style.

Turnbull has combined advisory and investing in several of his recent projects, including Star Mining. The move to Turnbull's house will give Howison access to a new social list should he decide to foster more local art. He opened his Potts Point home last year to help raise S200.000 to finance an exhibition tour of the US of selected Aussie artists. returns returning 6.7 per cent, and Westpac Capital Growth 6.4 per cent. Among capital stable funds, Rothschild 5 Arrows Capital Stable had the best annual return among the low-risk diversified portfolios, returning 11.7 per cent over the June year.

Super funds show strong The savage price war in the Australian sugar refining industry has devastated the first full-year figures of Mackay Refined Sugars (MRS), which has suffered an annual loss approaching $30 million. As a private company MRS is not obliged to publicly reveal its accounts. However, 50 per cent shareholder in the group, the UK-based E.D. F. Man, has announced it booked an SA15.6 million loss from the project in the year to March.

Due to currency factors it is not possible to exactly calculate MRS's result but it is believed to be approaching the $30 million mark. MRS chief executive officer Mr Athol Harley said last night first was scrapped. However, the market scuttlebutt that it was a bad sign for the float or, alternatively, the two brokers were fighting over their respective lunches, has been strenuously denied. The official line is that chairman Pemberton felt it was silly having two gatherings to hear the same song, so he requested the lunches be merged and moved to a different venue for the 100 or so guests. From London possibly after at least the women's finals at Wimbledon for some of the entourage it is off to the US for the biggest OZ show since Midnight Oil.

There will be some criss-crossing of the continent, apparently including a helicopter ride for some of the first-class team. Finally, it's gone IVEN the history surrounding its Ashfield propertv it was hardlv surprising that Exicom's chief Stephen Newman was "delighted" to announce. Results for the three months to June 30 also ere strong, ith a median return of 5.4 per cent from pooled funds. Equitlink SuperTrust and ANZ Growth had the highest returns over the quarter, returning 6.8 per cent respectively, with Zurich Managed Growth 3-. Home Owner 1 Year (effective from 19 1 Year (effective from 19 Variable (elective from 1 9 'Refers to Bank State Term 3 months 6 months 12 months For amounts S5 000 (effective from 1 2 State Bank Earn up to: (effective from I 7 State Earn up to: (effective from 29 paid quarterly For Variable Netherlands, Germany and Central Europe.

Last October the company also won the right to manage the distribution of Fiat's spare-parts division in Italy. Logistics involves the management of a company's supply needs by providing such services as marketing, warehousing and packaging. TNT said in a statement the accord struck with Fiat would involve it transporting some 75,000 tonnes of spare parts a year to 4,800 European outlets, with 525 people being directly employed to accommodate the expansion. The Fiat contract, which has been sought for some time, is a the severe nature of the price war with CSR had forced the company to book a far bigger loss than was first expected. "It was a very large loss," he said.

"In fact, it was much larger than we anticipated and it was directly due to the price war." Mr Harley added to the gloom by saying there was no immediate relief available, with margins being squeezed to the point where production costs were not being covered. MRS is desperately hoping that an action filed in the Federal Court against CSR last December in relation to predatory pricing, misleading and deceptive conduct and a breach of fiduciary duties will deliver a favourable result. I i csts Ii.imiI 'ii tit tit (, (I sit tmt I's I Hi llit rt It ill hint in i t-sx, In tin 1 It mis I si 1 1 1 it -mnsiM, lr llh ml- stockmarket slowing and the increasing competition from Qantas. As well, there are now doubts surrounding the S550 million purchase of News Corporation's 50 per cent shareholding in the airline. It was hoped Air New Zealand would play a pivotal role in turning Ansett around with a complete review of the operations.

But negotiations between News Corp and Air New Zealand ran into trouble last week, prompting a meeting between key Air New Zealand executives and Prime Minister Keating to discuss issues, including the prospect of further rights for the Kiwi carrier. predatory pricing within the sugar industry. This led to CSR managing director Mr Geoff Kells claiming that his company had been vindicated in its pricing approach. A defiant Mr Harley said MRS would not crumble to the pressure being applied by CSR, explaining "nothing is toe hard for our company because we believe we have invested in the right way to organise sugar refining in However, he said the current climate had to be changed and that sensible pricing policies needed to be implemented in the near future before his company could even begin to contemplate a sustained recovery. MATTHEW KIDMAN AUSTRALIA (In "I li i is ttu tti'i i nri hi ii' ii li.H -x s.

A t- 'I I lit ntlv -ill. in pin tin m. wt, tU in st.nnl.inl i mil Ii it -t tint, tint iiiiiu i-i. ii tusi t) nt. 4 til p.i iiim I unit.

.1 I i 1 7 7 i I They've Done It! Partners are proud to announce the to Associateship of Amanda Greenslade Ibrahim. The new improved team at Partners will continue to give the sparkling the useful advice that we are renowned for. ByTONYKAYE Pooled superannuation funds averaged an investment return of 6.7 per cent in the year to June 30, while the average return from capital stable funds was 8 per cent, according to statistics released on Friday. The statistics from superan r-C Solomon ascendancy and Rita Solomon service and 7th Floor Telephone Loans Occupied Investment Vari-Low Rate 0 1 2 9A 7.50 pc Vari-Low Rate (No Fee) 0 12 94) 850 pa Rate 1 2 94) I 0.50 pa Application Valuation and Bank Legal Costs Deposits 6.85 pa 7.75 pa 8.05 Pa to 5250 000 5 95; Terms up to 5 years ava.labie Bond Series 22 8.40 pa 95) Terms from I to 5 years available All-ln-One Nominal Rate (PA) Y.eld (PAi 7.00 Pa 7. 1 9 pa 5 5J Inte-est calculated daily on the Ml balance and personal customers only I I 80 Clarence Street Sydney NSW 2000 262 3100 Facsimile 262 3124 BUSINESS BRIEFS CanWest earnings at $60m Australia's lowest-rating television network, Ten, has contributed more than 50pc of CanWest Global's after-tax profit of $C58m in the third quarter of its financial year to May 31, 1995.

The Canadian media operator, which holds 57.5pc of Ten, reported a 70pc increase over last year's net earnings of SC34m for the total group. New deal for Johnson's Well Joseph Gutnick's Johnson's Well Mining NL has strengthened its hand in Western Australia's Duketon gold belt with a S15m option agreement over Maiden Gold NL's Famous Blue gold tenements. A second option provides for the company to earn a further 29pc interest by funding a bankable feasibility study, committing to a mine and paying Maiden another $13m within 33 months. The deal propelled Maiden shares 3c higher to 24c. Johnson's Well was last traded at $5.10 on Wednesday.

IBM aims at home market Taking aim at the fast-growing market for computer-related home electronics, IBM will create a division responsible for expanding the company's offerings. The new division will bring several of IBM's consumer-orientated products, such as multi-media personal computers and desktop software, under one umbrella. Berlusconi expects sale ROME (Reuter): Italy's former prime minister Silvio Berlusconi said he hoped to complete the sale of his television interests by the end of the (northern) summer. "The negotiations are pretty lengthy but they are concrete," Mr Berlusconi said. Media tycoon Rupert Murdoch and an international consortium lead by Saudi Prince Al-Waleed Bin Talal are competing for a slice of Mr Berlusconi's profitable television holdings.

Gasgoyne exercises option Gasgoyne Gold Mines NL will exercise an option to buy a 45pc stake in the Awak Mas gold project in Indonesia, its partner Lone Star Exploration said. Lone Star said the partners had decided to extend their current drilling program at Awak Mas after receiving encouragement from recent exploration results. Gasgoyne shares closed 3c up on Friday at $1.41. Lone Star shares ended 4c up at 37c. St George cuts loan rate St George Bank has cut its investment and owner-occupied three-year fixed home loan rate by 0.80 percentage points to 8.95pc from July 8.

No other rates were changed. A spokesman said the market for home loans was particularly competitive at the moment China keeps on growing BEIJING (Bloomberg): China's industrial output growth rose to 13.9pc year-on-year in June, up from 13.1pc in May, the State Statistics Bureau reported. The growth brought industrial output in the first six months to 856.6bn yuan a growth rate of 14pc over the same period last year. Alter the latest stock prices? Just one call to onv of these services will give vou an instant report on the latest ups and downs. The Age MarketCall 1902 941 510 Sydney Morning Herald MarketCall 1902 941 550 1 manual Reiew MarketCall 1902 941 520 Rate Term Loan Overdraft Reference Rate (effective from 19 12 94) 1 1 .25 pa Fixed Rate Term Loans Base Lending Rates Avoiiable on request Bill Rate Loan Rates Avo.bbie on request 'Special Offers' 96 PER ANNUM Business Plus Variable Rate (effective from 19 1 2 94) Business Plus Fixed Rate (effective from 22 5 95) 9.25pa 8.95 pa from 1 0.75 pa Leasing 95) HVESTMENT YELP RATE $100,000 7.00 6.78 $20,000 $99,999 6.17 6.00 $10,000 $19,999 4.86 4.75 i $5,000 $9,999 4.33 4.25 $0 $4,999 2.53 2.50 7 The InfoCair Service.

elstra Business (effective from 6 from 8.30am 5100,000 -and 6 State Business 1 00,000 $50,000 $20,000 $5,000 (effective from 3 4 State Money Cheque Account Nominal jte (PA) and over 6.40 po $99,999 6.25 pa $49,999 6.00 po 4.60 po 95) Market Account Rates effective 107S5 (ACT NSW accounts) ADVANCING daily interest, paid monthly cheque book and card access For more information call Advance Bank on 936 4050 or Freecall outside Sydney i' 1 1 1 )) I r.itt 1 1 I Ii.um it 1 ill In movi. 1 1 It' IX 1 Il.tVt I Ittls. (1 nil ill. lulls ,) ut i 1 1 nt if ills In uiiiiu in in. tit lnt( mhih Ii 'in ti, i I Intm Mnlnh I m.

ills mI (, in ilit in i. t-s I nl. m.n I opening balance on 1 800 242 947 over S50.000 $99,999 $20,000 $49,999 It. ii 1 i nl i ilt (- It it mw hills it i Ii.ui .1 nl p. i IWmI, i- t' I 1 i minimum of $5,000 to 6.30pm.

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