AGL Energy Limited (AGL):
The nation’s biggest energy companies, including AGL Energy, Energy Australia and Citipower/Powercor, have joined forces with energy software firm Greensync to build the smart grid of the future and make 300 megawatts of spare power capacity available to help avoid blackouts this summer. The partnership gives the Melbourne-based firm a head start in the race to host‘‘demand response’’ of distributed energy in Australia, a service that Chief Scientist Alan Finkel and Australian Energy Markets Operator chief Audrey Zibelman say can help restore stability to the power grid. As part of the partnership, Energy Queensland will partner Greensync to launch Australia’s largest, though as yet unquantified, ‘‘virtual power plant’’ in north Queensland. A virtual power plant is a network of distributed energy resources such as solar panels, batteries and smart appliances that can be managed like a power plant using energy management software platforms such as Greensync’s deX platform. DeX was launched on Thursday and will be rolled out to utilities in the March quarter of 2018.
Ardent Leisure Group (AAD); Ariadne Australia Limited (ARA):
Ardent Leisure chief executive Simon Kelly said the flooding and closure of five retail outlets in Houston by tropical storm Harvey would do nothing to alter the company’s strategy of clustering centres in locations such as Texas. As it reported audited figures for the year to June showing a net loss of $64.5 million, the challenged entertainment company said on Thursday the tropical storm that has killed at least 31 people had forced closed five leisure centres in Houston – out of a total 37 in its Main Event Entertainment division – and that it was assessing a further three for possible damage. Three centres were expected to reopen within seven days, the fourth could take up to two months to reopen and it was not possible to say when the fifth centre would reopen, but insurance would cover costs and loss of earnings, the company said. The US strategy will come under scrutiny on Monday, when a shareholder meeting called by 10.9 per cent holder Ariadne will vote on Ariadne’s proposal to appoint US-based Brad Richmond to the board. Ardent and proxy firms ISS and CGI-Glass Lewis oppose Mr Richmond’s candidacy, while proxy firm Ownership Matters supports it.
Arrium Limited (ARI):
Grant Thornton was in control for six days and then Korda Mentha for a marathon 17 months. But the epic administration of the Arrium business has finally come to a close with the bulging banking syndicate, which includes Australia’s big four, likely to end up with close to 70¢ in the dollar. Spanish bank BBVA and a string of note holders from the United States have also been along for the agonising ride which officially came to an end on Thursday afternoon when British billionaire Sanjeev Gupta and his GFG Alliance took control when the final paperwork was signed off. It marks the full stop in one of the longest administrations in Australia’s corporate history. All up, 60 banks were owed money and about 30 bond and note holders.
BlueScope Steel Limited (BSL):
The backers of a small mining company in New Zealand have launched an $886 million legal claim against ASXlisted Bluescope, claiming the steel giant reneged on a deal to sell a Kiwi iron sands business. NZ Iron Sands agreed to buy the Taharoa Iron Sands mining business from Bluescope subsidiary Toward Industries in November 2016, in a deal it says would have delivered Bluescope a royalty of up to $NZ131.7 million ($119 million), depending on the iron ore price. But in its statement of claim lodged in the New Zealand High Court, and obtained by The Australian Financial Review, NZIS claims Bluescope’s subsidiaries ‘‘failed to use all reasonable endeavours’’ to ensure a number of conditions attached to the deal were satisfied, causing the sale to fall through. Bluescope then announced in April it had offloaded Taharoa Iron Sands to a company majority owned by Taharoa C Block Incorporation, the owner of the land upon which the mining operations are conducted. But instead of receiving a royalty payment, Bluescope was required to pay the new owners $51 million to close the deal. The $886 million claim is based on trading profits NZIS could have made between 2017 and 2019; it says the estimate is based on modelling by Bluescope’s adviser in the sale, Moelis & Co.
Commonwealth Bank of Australia (CBA):
The guardians of the bank should be the government relations team and to a lesser extent corporate affairs. Either, these groups were not doing their job or they were not being listened to. Clearly, they were ineffective. Political fixers are not the right people to manage relations between government and complex businesses. What happened at the Commonwealth Bank is becoming a little clearer. It appears that the problems were well known and discussions under way with the regulator and internally about the appropriate action to take. That shifts the focus away from the operational areas and towards the groups inside the bank that are responsible for managing regulatory problems. It is likely then that the heart of the problems lies somewhere between the risk, legal and financial functions, rather than in the retail bank. It seems most likely that after analysing the situation, somebody in those core governance areas decided that the situation that has now brought the bank under an APRA probe was not a material issue and that the remediation efforts under way were appropriate. Clearly, that was a big mistake. We can expect serious consequences for the bank and some of the individuals involved.
Harvey Norman Holdings Limited (HVN):
Harvey Norman chairman Gerry Harvey is holding out on the prospect of a share buy-back to lift shareholder spirits after the retailer’s decision to slash its final dividend despite record profits sent the shares down more than 7 per cent. Harvey Norman cut its final dividend by 5¢ to 12¢ a share to preserve cash, despite lifting bottom-line net profit by 29 per cent to a record $448.9 million after riding the tailwinds of the housing and property booms. Investors were also underwhelmed by sales momentum in the June quarter and the first eight weeks of 2018, with same-store sales growth in Australia slowing as demand for furniture, homewares, consumer electronics and appliances came off the boil. Changes to the accounting treatment for loans to franchisees also raised concerns. ‘‘Ninety per cent of the questions on the investor call were about accounting details,’’ said one investment analyst. Shareholders greeted Harvey Norman’s ‘‘truly unprecedented’’, ‘‘recordbreaking’’ result by dumping the stock, which closed down 7.5 per cent – the stock’s largest single-day fall since March.
Macquarie Atlas Roads Limited (MQA):
Tollroad company Macquarie Atlas Roads has appointed advisers to assess investment opportunities and ‘‘strategic issues’’, including its relationship with Macquarie Group, to which it pays management fees. Macquarie Group owns about 12 per cent of the tollroad company, which said on Thursday it was assessing whether the current structure, including its relationship with Macquarie as external manager, was in ‘‘the best interests’’ of shareholders. ‘‘To date, the directors have taken an informed view that this structure has been to security holders’ benefit. [Our boards] have now appointed Adara Partners and King & Wood Mallesons to provide independent advice to assist them in forming their views on a variety of matters including investment opportunities and strategic issues.’’
Mcgrath Ltd (MEA):
Investors looking to build a position in struggling real estate group McGrath ahead of a potential private equity deal will get their opportunity next week when 46.3 per cent of McGrath shares – more than half of them owned by founder John McGrath – come out of escrow. On top of that another 7 per cent of shares owned by former Sydney franchisee Shane Smollen and other Smollen associates come out of escrow on September 30. Yesterday, The Australian Financial Review’s Street Talk column reported that Anchorage Capital, Adamantem Capital, Advent Partners and Crescent Capital Partners were among firms taking a close look at the country’s thirdbiggest real estate sales group. McGrath shares traded up 3.5 per cent yesterday following the Street Talk revelations closing at 75¢, but are still worth a little over a third of their value when the company floated in December 2015.
Mirvac Group (MGR):
The 4.5 per cent initial yield targeted in Mirvac’s pioneering effort to develop a build-to-rent apartment project may well be enough to get it over the line, according to analysts. The diversified developer has launched a club-style offer to wholesale investors to back the project, as revealed by The Australian Financial Review’s Street Talk column. Mirvac is looking to raise about $164 million through UBS, initially to fund a seed project in Sydney Olympic Park. Another three projects, worth about $750 million when completed, are also options for the club. Crucially, Mirvac is forecasting a 4.5 per cent initial yield from the seed project, which will have no gearing. That target yield sets a benchmark for returns from a sector which is wellestablished in the US and Britain, but yet to take root in the local market. SG Hiscock portfolio manager Grant Berry has been watching the nascent sector closely as major players edge closer to getting a viable project out of the ground. Mirvac’s 4.5 per cent target yield revealed this week can be compared to the expected yields from major office deals, Mr Berry said. ‘‘We are now seeing office buildings transact on yields below 5 per cent, then you have to allow for tenant incentives so in this context, I reckon it stacks up pretty well.’’
NextDC Ltd (NXT):
The corporate thirst for data has fuelled a record result for data centre operator NextDC, with revenue growing 30.7 per cent in 2016-17 to reach $123.6 million. The company, capitalised at $1.5 billion, made a $12.8 million profit after tax in 2016-17, up $11.1 million from the previous year. But $10.2 million of that was attributable to a one-off recognition of deferred tax assets. The group’s shares closed on Thursday at $4.58, up 7.8 per cent on the results, which analyst Paul Mason at RBC Capital Markets said were in line with expectations. As server rooms continue to be shuttered in preference for housing data in public or private clouds offpremises, NextDC will spend $250 million in 2017-18 opening its second centres in Brisbane, Melbourne and Sydney. It has $600 million in debt facilities to fund this capex and more, including $300 million in senior debt syndicated by National Australia Bank, which NextDC chief executive Craig Scroggie brokered last month with the bank’s new chief customer officer, former NSW premier Mike Baird.
OrotonGroup Limited (ORL):
OrotonGroup’s decision to close the loss-making Gap business will cost the accessories and clothing retailer at least $5 million before lease exit costs. In a trading update on Thursday, OrotonGroup confirmed that underlying earnings before interest, tax depreciation and amortisation, before oneoff costs, would come in at the upper end of its previous guidance range of $2 million to $3 million. This compares with underlying EBITDA of $12.9 million in 2016 and includes about $2.6 million in operating losses at Gap. However it does not include about $1.3 million in one-off costs related to the acquisition of accessories business The Daily Edited, a payout to former chief executive Mark Newman and an ongoing strategic review or Gap closure costs. Analysts and investors had previously expected Gap Australia to lose about $5 million this year compared with losses of $3 million on sales of $27 million in 2016. OrotonGroup said the impact of the closure of Gap on the 2017 results was still being determined but at this stage the retailer expected to incur additional costs of about $5 million, including a non-cash impairment charge around $3.3 million and other related exit costs of $1.7 million.
Qantas Airways Limited (QAN):
Qantas flights to London will stop in Singapore instead of Dubai from March next year under a revamped alliance with Middle Eastern partner Emirates, as the airline prepares to increase its presence in the fast-growing Asian market. The decision to abandon the Middle Eastern hub, established when Qantas teamed up with Emirates five years ago, follows a similar move by Virgin Australia, which ended flights with its alliance partner Etihad to Abu Dhabi in February. Qantas and Virgin are increasingly focusing their attention on the booming Asian travel market. Qantas flights to London will stop in Singapore instead of Dubai from March next year under a revamped alliance with Middle Eastern partner Emirates, as the airline prepares to increase its presence in the fast-growing Asian market. Fast forward to 2017 and Qantas is back on its feet financially, its international operations are profitable and Qantas has the capital to spend on new routes and aircraft. The economic slowdown in the Gulf following a collapse in oil prices and political unrest has cut travel demand in the region. After years of booming profits, Emirates reported an 82 per cent drop in annual profits in May. Qantas needed Emirates more than Emirates needed Qantas when they first partnered up six years ago. The situation has now reversed.
Reliance Worldwide Corporation Ltd (RWC):
Munz family undertake partial selldown in Reliance Worldwide Corporation. Sale follows solid full-year results by Reliance despite US problems. Melbourne industrialist Jonathan Munz and his family are set to surge higher up the Financial Review Rich List after a $373 million payday from a partial selldown in plumbing supplies firm Reliance Worldwide Corporation. The Munz family had already reaped $919 million in 2016 from the initial public offering of the company, which was the biggest public float on the ASX last year, before selling down from 30 per cent to 10 per cent in a large block trade late on Wednesday. The large Munz stake officially came out of escrow after Reliance unveiled its full-year results on August 28, which showed solid progress even though it is caught up in a potentially bruising battle between the two hardware retailing giants of the United States, Home Depot and Lowe’s.
Uber:
Uber’s new chief executive says the company might go public between 2019 and 2021. He should go sooner. In Dara Khosrowshahi’s first meeting with employees on Wednesday he told them that – although public life ‘‘sucks’’ because of investors’ short-term focus – the ride-hailing app would eventually do an initial public offering. In reality, Uber has helped repudiate the idea that venture-backed companies should defer IPOs indefinitely. Employees have been left demoralised – or just left – as Uber’s sexual harassment scandal spiralled out of control. An ineffective board failed to impose discipline on executives and then indulged in damaging lawsuits. Not every public company imposes strong governance, but it is hard to imagine that a traditional shareholder base would have allowed the situation to fester. Public enemies aver that Uber’s share price would have fallen on the scandals. But this has happened anyway. The privilege of privacy has been diluted, thanks to the mutual funds who piled into unicorn investing and are obliged to mark their investments up or down on a quarterly basis. In Uber’s case, Vanguard and Hartford reduced their valuations by 15 per cent at the end of June.
Woolworths Limited (WOW):
Anti-sugar soft drinks company Nexba expects to triple sales in 2017-18 to beyond $10 million after securing a distribution deal with Woolworths to stock the products in all 960 of its supermarkets as a consumer backlash against sugar builds. Nexba, whose investors include former David Jones chief executive Paul Zahra, is also in the final stages of a $3.5 million equity raising, choosing to use a crowd-funding platform, VentureCrowd, rather than tap into traditional funding sources. The company, which has a national distribution deal with Australia’s other big supermarket player, Coles, had dipped its toe in the water with Woolworths previously, with special ranges of iced tea and other products. Woolworths supermarkets have reinvigorated their growth rates after a turnaround plan by Woolworths chief executive Brad Banducci, and are expected to produce double-digit earnings growth for 2017-18, although that renewed confidence is being tempered by the big losses at the company’s discount department store chain Big W.
(Source: AIMS)
The nation’s biggest energy companies, including AGL Energy, Energy Australia and Citipower/Powercor, have joined forces with energy software firm Greensync to build the smart grid of the future and make 300 megawatts of spare power capacity available to help avoid blackouts this summer. The partnership gives the Melbourne-based firm a head start in the race to host‘‘demand response’’ of distributed energy in Australia, a service that Chief Scientist Alan Finkel and Australian Energy Markets Operator chief Audrey Zibelman say can help restore stability to the power grid. As part of the partnership, Energy Queensland will partner Greensync to launch Australia’s largest, though as yet unquantified, ‘‘virtual power plant’’ in north Queensland. A virtual power plant is a network of distributed energy resources such as solar panels, batteries and smart appliances that can be managed like a power plant using energy management software platforms such as Greensync’s deX platform. DeX was launched on Thursday and will be rolled out to utilities in the March quarter of 2018.
Ardent Leisure Group (AAD); Ariadne Australia Limited (ARA):
Ardent Leisure chief executive Simon Kelly said the flooding and closure of five retail outlets in Houston by tropical storm Harvey would do nothing to alter the company’s strategy of clustering centres in locations such as Texas. As it reported audited figures for the year to June showing a net loss of $64.5 million, the challenged entertainment company said on Thursday the tropical storm that has killed at least 31 people had forced closed five leisure centres in Houston – out of a total 37 in its Main Event Entertainment division – and that it was assessing a further three for possible damage. Three centres were expected to reopen within seven days, the fourth could take up to two months to reopen and it was not possible to say when the fifth centre would reopen, but insurance would cover costs and loss of earnings, the company said. The US strategy will come under scrutiny on Monday, when a shareholder meeting called by 10.9 per cent holder Ariadne will vote on Ariadne’s proposal to appoint US-based Brad Richmond to the board. Ardent and proxy firms ISS and CGI-Glass Lewis oppose Mr Richmond’s candidacy, while proxy firm Ownership Matters supports it.
Arrium Limited (ARI):
Grant Thornton was in control for six days and then Korda Mentha for a marathon 17 months. But the epic administration of the Arrium business has finally come to a close with the bulging banking syndicate, which includes Australia’s big four, likely to end up with close to 70¢ in the dollar. Spanish bank BBVA and a string of note holders from the United States have also been along for the agonising ride which officially came to an end on Thursday afternoon when British billionaire Sanjeev Gupta and his GFG Alliance took control when the final paperwork was signed off. It marks the full stop in one of the longest administrations in Australia’s corporate history. All up, 60 banks were owed money and about 30 bond and note holders.
BlueScope Steel Limited (BSL):
The backers of a small mining company in New Zealand have launched an $886 million legal claim against ASXlisted Bluescope, claiming the steel giant reneged on a deal to sell a Kiwi iron sands business. NZ Iron Sands agreed to buy the Taharoa Iron Sands mining business from Bluescope subsidiary Toward Industries in November 2016, in a deal it says would have delivered Bluescope a royalty of up to $NZ131.7 million ($119 million), depending on the iron ore price. But in its statement of claim lodged in the New Zealand High Court, and obtained by The Australian Financial Review, NZIS claims Bluescope’s subsidiaries ‘‘failed to use all reasonable endeavours’’ to ensure a number of conditions attached to the deal were satisfied, causing the sale to fall through. Bluescope then announced in April it had offloaded Taharoa Iron Sands to a company majority owned by Taharoa C Block Incorporation, the owner of the land upon which the mining operations are conducted. But instead of receiving a royalty payment, Bluescope was required to pay the new owners $51 million to close the deal. The $886 million claim is based on trading profits NZIS could have made between 2017 and 2019; it says the estimate is based on modelling by Bluescope’s adviser in the sale, Moelis & Co.
Commonwealth Bank of Australia (CBA):
The guardians of the bank should be the government relations team and to a lesser extent corporate affairs. Either, these groups were not doing their job or they were not being listened to. Clearly, they were ineffective. Political fixers are not the right people to manage relations between government and complex businesses. What happened at the Commonwealth Bank is becoming a little clearer. It appears that the problems were well known and discussions under way with the regulator and internally about the appropriate action to take. That shifts the focus away from the operational areas and towards the groups inside the bank that are responsible for managing regulatory problems. It is likely then that the heart of the problems lies somewhere between the risk, legal and financial functions, rather than in the retail bank. It seems most likely that after analysing the situation, somebody in those core governance areas decided that the situation that has now brought the bank under an APRA probe was not a material issue and that the remediation efforts under way were appropriate. Clearly, that was a big mistake. We can expect serious consequences for the bank and some of the individuals involved.
Harvey Norman Holdings Limited (HVN):
Harvey Norman chairman Gerry Harvey is holding out on the prospect of a share buy-back to lift shareholder spirits after the retailer’s decision to slash its final dividend despite record profits sent the shares down more than 7 per cent. Harvey Norman cut its final dividend by 5¢ to 12¢ a share to preserve cash, despite lifting bottom-line net profit by 29 per cent to a record $448.9 million after riding the tailwinds of the housing and property booms. Investors were also underwhelmed by sales momentum in the June quarter and the first eight weeks of 2018, with same-store sales growth in Australia slowing as demand for furniture, homewares, consumer electronics and appliances came off the boil. Changes to the accounting treatment for loans to franchisees also raised concerns. ‘‘Ninety per cent of the questions on the investor call were about accounting details,’’ said one investment analyst. Shareholders greeted Harvey Norman’s ‘‘truly unprecedented’’, ‘‘recordbreaking’’ result by dumping the stock, which closed down 7.5 per cent – the stock’s largest single-day fall since March.
Macquarie Atlas Roads Limited (MQA):
Tollroad company Macquarie Atlas Roads has appointed advisers to assess investment opportunities and ‘‘strategic issues’’, including its relationship with Macquarie Group, to which it pays management fees. Macquarie Group owns about 12 per cent of the tollroad company, which said on Thursday it was assessing whether the current structure, including its relationship with Macquarie as external manager, was in ‘‘the best interests’’ of shareholders. ‘‘To date, the directors have taken an informed view that this structure has been to security holders’ benefit. [Our boards] have now appointed Adara Partners and King & Wood Mallesons to provide independent advice to assist them in forming their views on a variety of matters including investment opportunities and strategic issues.’’
Mcgrath Ltd (MEA):
Investors looking to build a position in struggling real estate group McGrath ahead of a potential private equity deal will get their opportunity next week when 46.3 per cent of McGrath shares – more than half of them owned by founder John McGrath – come out of escrow. On top of that another 7 per cent of shares owned by former Sydney franchisee Shane Smollen and other Smollen associates come out of escrow on September 30. Yesterday, The Australian Financial Review’s Street Talk column reported that Anchorage Capital, Adamantem Capital, Advent Partners and Crescent Capital Partners were among firms taking a close look at the country’s thirdbiggest real estate sales group. McGrath shares traded up 3.5 per cent yesterday following the Street Talk revelations closing at 75¢, but are still worth a little over a third of their value when the company floated in December 2015.
Mirvac Group (MGR):
The 4.5 per cent initial yield targeted in Mirvac’s pioneering effort to develop a build-to-rent apartment project may well be enough to get it over the line, according to analysts. The diversified developer has launched a club-style offer to wholesale investors to back the project, as revealed by The Australian Financial Review’s Street Talk column. Mirvac is looking to raise about $164 million through UBS, initially to fund a seed project in Sydney Olympic Park. Another three projects, worth about $750 million when completed, are also options for the club. Crucially, Mirvac is forecasting a 4.5 per cent initial yield from the seed project, which will have no gearing. That target yield sets a benchmark for returns from a sector which is wellestablished in the US and Britain, but yet to take root in the local market. SG Hiscock portfolio manager Grant Berry has been watching the nascent sector closely as major players edge closer to getting a viable project out of the ground. Mirvac’s 4.5 per cent target yield revealed this week can be compared to the expected yields from major office deals, Mr Berry said. ‘‘We are now seeing office buildings transact on yields below 5 per cent, then you have to allow for tenant incentives so in this context, I reckon it stacks up pretty well.’’
NextDC Ltd (NXT):
The corporate thirst for data has fuelled a record result for data centre operator NextDC, with revenue growing 30.7 per cent in 2016-17 to reach $123.6 million. The company, capitalised at $1.5 billion, made a $12.8 million profit after tax in 2016-17, up $11.1 million from the previous year. But $10.2 million of that was attributable to a one-off recognition of deferred tax assets. The group’s shares closed on Thursday at $4.58, up 7.8 per cent on the results, which analyst Paul Mason at RBC Capital Markets said were in line with expectations. As server rooms continue to be shuttered in preference for housing data in public or private clouds offpremises, NextDC will spend $250 million in 2017-18 opening its second centres in Brisbane, Melbourne and Sydney. It has $600 million in debt facilities to fund this capex and more, including $300 million in senior debt syndicated by National Australia Bank, which NextDC chief executive Craig Scroggie brokered last month with the bank’s new chief customer officer, former NSW premier Mike Baird.
OrotonGroup Limited (ORL):
OrotonGroup’s decision to close the loss-making Gap business will cost the accessories and clothing retailer at least $5 million before lease exit costs. In a trading update on Thursday, OrotonGroup confirmed that underlying earnings before interest, tax depreciation and amortisation, before oneoff costs, would come in at the upper end of its previous guidance range of $2 million to $3 million. This compares with underlying EBITDA of $12.9 million in 2016 and includes about $2.6 million in operating losses at Gap. However it does not include about $1.3 million in one-off costs related to the acquisition of accessories business The Daily Edited, a payout to former chief executive Mark Newman and an ongoing strategic review or Gap closure costs. Analysts and investors had previously expected Gap Australia to lose about $5 million this year compared with losses of $3 million on sales of $27 million in 2016. OrotonGroup said the impact of the closure of Gap on the 2017 results was still being determined but at this stage the retailer expected to incur additional costs of about $5 million, including a non-cash impairment charge around $3.3 million and other related exit costs of $1.7 million.
Qantas Airways Limited (QAN):
Qantas flights to London will stop in Singapore instead of Dubai from March next year under a revamped alliance with Middle Eastern partner Emirates, as the airline prepares to increase its presence in the fast-growing Asian market. The decision to abandon the Middle Eastern hub, established when Qantas teamed up with Emirates five years ago, follows a similar move by Virgin Australia, which ended flights with its alliance partner Etihad to Abu Dhabi in February. Qantas and Virgin are increasingly focusing their attention on the booming Asian travel market. Qantas flights to London will stop in Singapore instead of Dubai from March next year under a revamped alliance with Middle Eastern partner Emirates, as the airline prepares to increase its presence in the fast-growing Asian market. Fast forward to 2017 and Qantas is back on its feet financially, its international operations are profitable and Qantas has the capital to spend on new routes and aircraft. The economic slowdown in the Gulf following a collapse in oil prices and political unrest has cut travel demand in the region. After years of booming profits, Emirates reported an 82 per cent drop in annual profits in May. Qantas needed Emirates more than Emirates needed Qantas when they first partnered up six years ago. The situation has now reversed.
Reliance Worldwide Corporation Ltd (RWC):
Munz family undertake partial selldown in Reliance Worldwide Corporation. Sale follows solid full-year results by Reliance despite US problems. Melbourne industrialist Jonathan Munz and his family are set to surge higher up the Financial Review Rich List after a $373 million payday from a partial selldown in plumbing supplies firm Reliance Worldwide Corporation. The Munz family had already reaped $919 million in 2016 from the initial public offering of the company, which was the biggest public float on the ASX last year, before selling down from 30 per cent to 10 per cent in a large block trade late on Wednesday. The large Munz stake officially came out of escrow after Reliance unveiled its full-year results on August 28, which showed solid progress even though it is caught up in a potentially bruising battle between the two hardware retailing giants of the United States, Home Depot and Lowe’s.
Uber:
Uber’s new chief executive says the company might go public between 2019 and 2021. He should go sooner. In Dara Khosrowshahi’s first meeting with employees on Wednesday he told them that – although public life ‘‘sucks’’ because of investors’ short-term focus – the ride-hailing app would eventually do an initial public offering. In reality, Uber has helped repudiate the idea that venture-backed companies should defer IPOs indefinitely. Employees have been left demoralised – or just left – as Uber’s sexual harassment scandal spiralled out of control. An ineffective board failed to impose discipline on executives and then indulged in damaging lawsuits. Not every public company imposes strong governance, but it is hard to imagine that a traditional shareholder base would have allowed the situation to fester. Public enemies aver that Uber’s share price would have fallen on the scandals. But this has happened anyway. The privilege of privacy has been diluted, thanks to the mutual funds who piled into unicorn investing and are obliged to mark their investments up or down on a quarterly basis. In Uber’s case, Vanguard and Hartford reduced their valuations by 15 per cent at the end of June.
Woolworths Limited (WOW):
Anti-sugar soft drinks company Nexba expects to triple sales in 2017-18 to beyond $10 million after securing a distribution deal with Woolworths to stock the products in all 960 of its supermarkets as a consumer backlash against sugar builds. Nexba, whose investors include former David Jones chief executive Paul Zahra, is also in the final stages of a $3.5 million equity raising, choosing to use a crowd-funding platform, VentureCrowd, rather than tap into traditional funding sources. The company, which has a national distribution deal with Australia’s other big supermarket player, Coles, had dipped its toe in the water with Woolworths previously, with special ranges of iced tea and other products. Woolworths supermarkets have reinvigorated their growth rates after a turnaround plan by Woolworths chief executive Brad Banducci, and are expected to produce double-digit earnings growth for 2017-18, although that renewed confidence is being tempered by the big losses at the company’s discount department store chain Big W.
(Source: AIMS)
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