AUSTRALIA MARKET
Thursday, May 18, 2017
Bank of Queensland Limited (BOQ):
Bank of Queensland chief executive Jon Sutton says the bank tax is too small to materially improve competition in the sector, one of the government’s key justifications for introducing it, but the competitive landscape would be better if big banks held more capital against mortgages – which he is urging the prudential regulator to push for. Mr Sutton also highlighted the escalating tension between the non-big four banks and the Australian Bankers’ Association led by Anna Bligh, who on Tuesday afternoon described the bank levy as a ‘‘secret tax’’ and criticised the government for using confidentiality agreements to ‘‘make it illegal for the bill to be tested in the public sphere’’.
Beach Energy Ltd (BPT); Origin Energy Ltd (ORG):
If there is one thing that could derail Origin Energy’s plans for another ASXlisted spin-off, it is Beach Energy. The $1.27 billion Beach is the most likely buyer of Origin’s Lattice Energy and it will take either a strong bid from either a rival buyer or the initial public offering path to knock it off. As the auction heats up, Street Talk understands Beach Energy has drafted in another investment banking adviser. Sources said Luminis Partners had been hired to advise Beach Energy’s board and help keep its bulge bracket advisers honest.
BHP Billiton Limited (BHP):
BHP chief executive Andrew Mackenzie will pitch his defence against activist investor Elliott directly to Australian shareholders next week, as the company seeks to maximise the value of its US shale assets before any potential sale or demerger. The future of the US shale division has become the focus of activist campaigns over the past month, and Mr Mackenzie acknowledged to investors on Tuesday that BHP had erred when it spent $US20 billion entering the business in 2011 and billions more developing it in subsequent years. Despite signalling that he was willing to part with the US shale assets for the right price, the fine detail of Mr Mackenzie’s presentations in Europe this week revealed that on the contrary, BHP was set to more than double the amount of activity in the division. BHP vowed to increase the number of rigs working its shale acreage from four to 10 over the next 14 months, in a move that will ensure oil and gas production from the declining division starts rising again between 2018 and 2023.
Wesfarmers Ltd (WES):
Wesfarmers’ shock decision to abandon plans to list its Officeworks retail chain on the ASX has cast doubt on the future of more than $8 billion of floats, as jittery investors apply closer scrutiny to new deals. Many hoped that the Officeworks float would reignite the IPO market, which took a hit last week when private equity firm Quadrant Private Equity pulled its $500 million float of tap and appliances company Zip Industries. But Wesfarmers, which was looking to float Officeworks for $1.4 billion to $1.5 billion, could attract offers of only about $1.2 billion. It said it pulled the float ‘‘in light of current equity market conditions’’ and will now examine a trade sale. Investors have grown increasingly concerned about the quality of floats coming to market after a series of recent disappointments, including Automotive Solutions Group, Wellard, Shaver Shop and Murray River Organics.
Woodside Petroleum Limited (WPL):
Woodside Petroleum chief executive Peter Coleman has declared that the revised $US25 billion plan ($34 billion) for the development of the company’s large natural gas resources in the Browse Basin off the far north-west coast could be as cost competitive as new supply emerging from the US and Russia. Mr Coleman said the plan to bring gas from the Browse fields down to the Woodside-operated North West Shelf plant in Karratha would be low cost. It would involve putting at risk only a third of the capital that would have been involved in the original plan for Browse gas, involving a $US75 billion plus new onshore LNG plant at James Price Point on the Kimberley coast. Woodside’s latest plan for Browse gas is the third reincarnation of a development plan after the James Price Point plan was ditched as uneconomic, as was a floating LNG project.
(Source: AIMS)
Thursday, May 18, 2017
Bank of Queensland Limited (BOQ):
Bank of Queensland chief executive Jon Sutton says the bank tax is too small to materially improve competition in the sector, one of the government’s key justifications for introducing it, but the competitive landscape would be better if big banks held more capital against mortgages – which he is urging the prudential regulator to push for. Mr Sutton also highlighted the escalating tension between the non-big four banks and the Australian Bankers’ Association led by Anna Bligh, who on Tuesday afternoon described the bank levy as a ‘‘secret tax’’ and criticised the government for using confidentiality agreements to ‘‘make it illegal for the bill to be tested in the public sphere’’.
Beach Energy Ltd (BPT); Origin Energy Ltd (ORG):
If there is one thing that could derail Origin Energy’s plans for another ASXlisted spin-off, it is Beach Energy. The $1.27 billion Beach is the most likely buyer of Origin’s Lattice Energy and it will take either a strong bid from either a rival buyer or the initial public offering path to knock it off. As the auction heats up, Street Talk understands Beach Energy has drafted in another investment banking adviser. Sources said Luminis Partners had been hired to advise Beach Energy’s board and help keep its bulge bracket advisers honest.
BHP Billiton Limited (BHP):
BHP chief executive Andrew Mackenzie will pitch his defence against activist investor Elliott directly to Australian shareholders next week, as the company seeks to maximise the value of its US shale assets before any potential sale or demerger. The future of the US shale division has become the focus of activist campaigns over the past month, and Mr Mackenzie acknowledged to investors on Tuesday that BHP had erred when it spent $US20 billion entering the business in 2011 and billions more developing it in subsequent years. Despite signalling that he was willing to part with the US shale assets for the right price, the fine detail of Mr Mackenzie’s presentations in Europe this week revealed that on the contrary, BHP was set to more than double the amount of activity in the division. BHP vowed to increase the number of rigs working its shale acreage from four to 10 over the next 14 months, in a move that will ensure oil and gas production from the declining division starts rising again between 2018 and 2023.
Wesfarmers Ltd (WES):
Wesfarmers’ shock decision to abandon plans to list its Officeworks retail chain on the ASX has cast doubt on the future of more than $8 billion of floats, as jittery investors apply closer scrutiny to new deals. Many hoped that the Officeworks float would reignite the IPO market, which took a hit last week when private equity firm Quadrant Private Equity pulled its $500 million float of tap and appliances company Zip Industries. But Wesfarmers, which was looking to float Officeworks for $1.4 billion to $1.5 billion, could attract offers of only about $1.2 billion. It said it pulled the float ‘‘in light of current equity market conditions’’ and will now examine a trade sale. Investors have grown increasingly concerned about the quality of floats coming to market after a series of recent disappointments, including Automotive Solutions Group, Wellard, Shaver Shop and Murray River Organics.
Woodside Petroleum Limited (WPL):
Woodside Petroleum chief executive Peter Coleman has declared that the revised $US25 billion plan ($34 billion) for the development of the company’s large natural gas resources in the Browse Basin off the far north-west coast could be as cost competitive as new supply emerging from the US and Russia. Mr Coleman said the plan to bring gas from the Browse fields down to the Woodside-operated North West Shelf plant in Karratha would be low cost. It would involve putting at risk only a third of the capital that would have been involved in the original plan for Browse gas, involving a $US75 billion plus new onshore LNG plant at James Price Point on the Kimberley coast. Woodside’s latest plan for Browse gas is the third reincarnation of a development plan after the James Price Point plan was ditched as uneconomic, as was a floating LNG project.
(Source: AIMS)
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