Australian and New Zealand Banking Group (ANZ):
ANZ has issued a blacklist of postcodes in Brisbane and Perth where it will impose tougher lending terms and conditions for apartment buyers amid growing fears about oversupply, falling prices and combustible cladding. The nation’s third-largest residential lender is also warning mortgage brokers that residential loan applications must be a ‘‘source of truth’’ in what appears to be a response to regulatory and investment bank claims that borrowers had qualified for about $500 billion in ‘‘liar loans’’. It is sending brokers, who act as intermediaries between the bank and borrowers, a detailed 10-page guide on the bank’s ‘‘minimum requirements and guiding principles’’ for the broker-client relationship. Major lenders are demanding more financial information from property borrowers in response to growing regulatory concern about spiralling household debt, static incomes and the increasingly likelihood of rising interest rates.
Commonwealth Bank of Australia (CBA):
The Commonwealth Bank, the nation's largest residential property lender, is sharply turning the screws on mortgage brokers' who recommend interest-only loans, amid growing pressure to lower default risks as rates look set to rise. Brokers will have to provide documented evidence to the bank that they explained the potential risks of interest-only mortgages, even if they decide not to go ahead with that type of loan. CBA's latest measure is more evidence it is pushing ahead with a strategy to retake control over mortgage sales and distribution after ceding about half of new loans to brokers over the past 30 years.
Fletcher Building Limited (FBU):
New Zealand-headquartered and ASX-listed construction and building materials firm Fletcher Building has confirmed auditor KPMG is reviewing four of its major projects after losses in its construction division helped the company’s full-year earnings fall 80 per cent. Fletcher was responding to speculation it had hired KPMG, and said the auditor would review its two largest construction projects and two largest infrastructure projects to “augment existing governance processes”. New Zealand’s construction industry is at capacity, struggling to find enough skilled workers to match the demand for new homes and infrastructure, fuelled by a rapidly growing population. Last month, Fletcher’s buildings and interiors unit, part of its construction division, reported a $NZ292 million ($267m) loss after issues including “inadequate project management” and capacity pressures in NZ hurt two major projects, one in Auckland and another in Christchurch. This weighed on its net earnings, which were down sharply despite revenue rising 4 per cent to $NZ9.4 billion.
Fonterra Limited (FSF):
New Zealand dairy giant Fonterra has confirmed it has lodged a bid for Australian co-operative Murray Goulburn, while revealing it was poised to overtake its rival to become this country’s biggest buyer of milk. Fonterra Australia chief executive Rene Dedoncker told The Australian Financial Review the processor would buy up to 2.5 billion litres of milk in 2017-18, up from a current run rate of 2 billion litres, with the first 100 million litres of thatcoming across inthe next 90 days as the company unleashed an extra 75,000 metric tonnes of processing capacity added in the last 18 months. Amid this momentum, Mr Dedoncker confirmed Fonterra had made an ‘‘indicative non-binding submission’’ to Murray Goulburn’s board, on which he expected it would form a position before its annual meeting on October 22. Murray Goulburn (MG) is under enormous pressure after its milk intake plunged following a disastrous decision last year to retrospectively cut milk prices. In August it reduced its milk intake guidance for 2017-18 to just 2 billion litres. This is down from 3.5 billion litres in 2016. The struggling Melbourne-based co-operative revealed last month it had asked Deutsche Bank to seek detailed ‘‘proposals’’ from third party bidders, including takeover offers.
Kathmandu Holdings Limited (KMD):
New products, sharper pricing and better online content helped outdoor and leisure retailer Kathmandu lift net profit 13.5 per cent to $NZ38.04 million in 2017. The result was in line with Kathmandu's August guidance, when the retailer broke from the pack amid a raft of downgrades in the discretionary retail sector and forecast a higher than expected profit between $NZ37.4 million and $NZ38 million. Earnings before interest and tax for the 12 months ending July rose 12 per cent to $NZ57 million, the top end of guidance. Chief executive Xavier Simonet attributed the improved result to self-help measures such as innovative new products, including multi-functional rain jackets, improved execution of promotions, better marketing and cost control. While the market remained "intensely competitive", Kathmandu managed to lift same-store sales in Australia by 6.9 per cent and by 3.6 per cent in New Zealand, boosting group sales for the year by 4.6 per cent to $NZ445.3 million.
Lendlease Group (LLC); Centuria Capital Limited (CNI):
Lendlease's powerful investment arm, Australian Prime Property Fund Commercial, has all but snared one of the Sydney's brightest offerings currently, Swire House in the heart of the financial district. Held by listed property group Centuria, the tower at 10 Spring Street was expected to fetch $220 million or more. It is understood Lendlease APPF Commercial is doing the final leg of its due diligence at a price well above expectations. Among the underbidders was Dexus, which bought a half-stake sale in the city's tallest building, the MLC Centre for $722 million in June.
Nufarm Limited (NUF):
Crop protection group Nufarm has set the bar for acquisitions at up to $US1 billion as it assesses opportunities created by global consolidation in the industry. Nufarm chief executive officer Greg Hunt said the Melbourne-based company was looking to acquisitions, which fitted with its strategy of focusing the business on select countries and crops with growth potential. Mr Hunt said Nufarm would not compromise its capital structure by biting off more than it could chew and was highly unlikely to complete a transaction this calender year.
Propertylink Group (PLG):
Propertylink has rebuffed a $573 million takeover proposal from fellow fund manager Centuria, which had established a 17 per cent stake in its target this month. Propertylink has rebuffed a $573 million takeover proposal from fellow fund manager Centuria, which had established a 17 per cent stake in its target this month. The listed Propertylink said the Centuria proposal undervalued its funds management platform and real estate portfolio, and held no premium for control. Led by John McBain, Centuria Capital, the parent fund manager, and one of the listed vehicles it manages, Centuria Industrial REIT, built a combined 17 per cent in Propertylink two weeks ago after a lightning raid. Behind the scenes, it was followed by an initial approach, then an indicative, conditional and non-binding proposal to acquire the remaining units in Propertylink through a scheme of arrangement.
Suncorp Group Limited (SUN):
Australia's sixth largest bank Suncorp has joined the big banks in scrapping unpopular foreign ATM fees. Suncorp has almost 400 ATMs and more than one million customers. The announcement on Tuesday morning followed a series of announcements from the big four banks on Sunday rush to torpedo the fees on Sunday. Suncorp executive general manager Bruce Rush said the regional bank will remove all fees from its ATMs before the end of the calendar year. "Suncorp supports fee-free ATMs and we will implement this change in early December to coincide with other positive changes, including updating technology and enhancing customer experience which is already planned for our ATM network," Mr Rush said. The Reserve Bank estimated that there are some 250 million withdrawals made from foreign ATMs every year. Analysis from Deutsche Bank found that big four's decision will see the banks forgo $117 million in fees each year.
Sydney Airport Holdings (SYD):
Sydney Airport, which runs Australia’s busiest airport, says the head of General Electric Co’s unit in Australia will take over as chief executive in the coming months. The appointment of Geoff Culbert comes after current Sydney Airport chief executive Kerrie Mather said she would step down, prompting the airport to launch a global search for her replacement. Mr Culbert, who has been president and chief executive of GE Australia, New Zealand and Papua New Guinea since 2014, will begin his new role at the airport before the end of January. He will be paid an annual salary of $1.5 million, including superannuation.
South32 (S32):
ASX-listed miner South32 is reviewing its relationship with its auditor KPMG due to a corruption scandal embroiling the big-four accounting firm in South Africa. The scandal revolves around allegations against the billionaire Gupta family, which has extensive business interests in South Africa, and its very close relationship with President Jacob Zuma. It has provoked a political firestorm that has destroyed international lobbying and PR firm Bell Pottinger and deeply wounded KPMG South Africa. KPMG has been forced to admit its audits of Gupta companies “fell well short of the quality expected” and has walked away from a controversial report attacking a so-called “rogue unit” within the South African Revenue Service, which had reportedly been investigating the family. In a statement released a fortnight ago, KPMG International said its South African chief executive and chief operating officers had resigned, five partners “will be leaving the firm” and it would sack the partner in charge of the Gupta audits.
Tabcorp Holdings Limited (TAH); Tatts Group Limited (TTS):
The timetable set down by gambling giants Tabcorp and Tatts to execute their $11bn merger has blown out despite a court win this morning. Justice John Middleton, the president of the Competition Tribunal, granted Tabcorp a speedy re-hearing of its application to approve the merger over the protests of the competition watchdog and James Packer-backed corporate bookmaker CrownBet. However, the dates set down by Justice Middleton — October 24 and 25 — fall after a proposed meeting where Tatts shareholders are to vote on the deal, on October 18, and clash with the date by which Tatts hoped to get court approval, October 24. The meeting and court approval date will need to be rescheduled. In good news for the mega-merger, which has now been underway for almost a year, if the tribunal again approves the deal it will still be possible to consummate the marriage before Tabcorp’s offer expires on December 31.
Xanadu Mines (XAM):
Xanadu Mines is seeking to raise $10 million, with the ability to raise additional funds up to and within the 15 per cent placement capacity of the junior explorer. The offer price of 20¢ represents a 2.4 per cent discount to the last close and a 6.6 per cent discount to the 10-day volume-weighted average price, according to a term sheet sent to fund managers. Xanadu Mines explores and develops various mineral exploration projects in Mongolia. Its flagship project is the Kharmagtai porphyry copper-gold project, located in southern Mongolia. Placement proceeds will be used for exploration activities at Kharmagtai, Red Mountain and Yellow Mountain; repayment of the Noble debt facility; and general working capital.
(Source: AIMS)
ANZ has issued a blacklist of postcodes in Brisbane and Perth where it will impose tougher lending terms and conditions for apartment buyers amid growing fears about oversupply, falling prices and combustible cladding. The nation’s third-largest residential lender is also warning mortgage brokers that residential loan applications must be a ‘‘source of truth’’ in what appears to be a response to regulatory and investment bank claims that borrowers had qualified for about $500 billion in ‘‘liar loans’’. It is sending brokers, who act as intermediaries between the bank and borrowers, a detailed 10-page guide on the bank’s ‘‘minimum requirements and guiding principles’’ for the broker-client relationship. Major lenders are demanding more financial information from property borrowers in response to growing regulatory concern about spiralling household debt, static incomes and the increasingly likelihood of rising interest rates.
Commonwealth Bank of Australia (CBA):
The Commonwealth Bank, the nation's largest residential property lender, is sharply turning the screws on mortgage brokers' who recommend interest-only loans, amid growing pressure to lower default risks as rates look set to rise. Brokers will have to provide documented evidence to the bank that they explained the potential risks of interest-only mortgages, even if they decide not to go ahead with that type of loan. CBA's latest measure is more evidence it is pushing ahead with a strategy to retake control over mortgage sales and distribution after ceding about half of new loans to brokers over the past 30 years.
Fletcher Building Limited (FBU):
New Zealand-headquartered and ASX-listed construction and building materials firm Fletcher Building has confirmed auditor KPMG is reviewing four of its major projects after losses in its construction division helped the company’s full-year earnings fall 80 per cent. Fletcher was responding to speculation it had hired KPMG, and said the auditor would review its two largest construction projects and two largest infrastructure projects to “augment existing governance processes”. New Zealand’s construction industry is at capacity, struggling to find enough skilled workers to match the demand for new homes and infrastructure, fuelled by a rapidly growing population. Last month, Fletcher’s buildings and interiors unit, part of its construction division, reported a $NZ292 million ($267m) loss after issues including “inadequate project management” and capacity pressures in NZ hurt two major projects, one in Auckland and another in Christchurch. This weighed on its net earnings, which were down sharply despite revenue rising 4 per cent to $NZ9.4 billion.
Fonterra Limited (FSF):
New Zealand dairy giant Fonterra has confirmed it has lodged a bid for Australian co-operative Murray Goulburn, while revealing it was poised to overtake its rival to become this country’s biggest buyer of milk. Fonterra Australia chief executive Rene Dedoncker told The Australian Financial Review the processor would buy up to 2.5 billion litres of milk in 2017-18, up from a current run rate of 2 billion litres, with the first 100 million litres of thatcoming across inthe next 90 days as the company unleashed an extra 75,000 metric tonnes of processing capacity added in the last 18 months. Amid this momentum, Mr Dedoncker confirmed Fonterra had made an ‘‘indicative non-binding submission’’ to Murray Goulburn’s board, on which he expected it would form a position before its annual meeting on October 22. Murray Goulburn (MG) is under enormous pressure after its milk intake plunged following a disastrous decision last year to retrospectively cut milk prices. In August it reduced its milk intake guidance for 2017-18 to just 2 billion litres. This is down from 3.5 billion litres in 2016. The struggling Melbourne-based co-operative revealed last month it had asked Deutsche Bank to seek detailed ‘‘proposals’’ from third party bidders, including takeover offers.
Kathmandu Holdings Limited (KMD):
New products, sharper pricing and better online content helped outdoor and leisure retailer Kathmandu lift net profit 13.5 per cent to $NZ38.04 million in 2017. The result was in line with Kathmandu's August guidance, when the retailer broke from the pack amid a raft of downgrades in the discretionary retail sector and forecast a higher than expected profit between $NZ37.4 million and $NZ38 million. Earnings before interest and tax for the 12 months ending July rose 12 per cent to $NZ57 million, the top end of guidance. Chief executive Xavier Simonet attributed the improved result to self-help measures such as innovative new products, including multi-functional rain jackets, improved execution of promotions, better marketing and cost control. While the market remained "intensely competitive", Kathmandu managed to lift same-store sales in Australia by 6.9 per cent and by 3.6 per cent in New Zealand, boosting group sales for the year by 4.6 per cent to $NZ445.3 million.
Lendlease Group (LLC); Centuria Capital Limited (CNI):
Lendlease's powerful investment arm, Australian Prime Property Fund Commercial, has all but snared one of the Sydney's brightest offerings currently, Swire House in the heart of the financial district. Held by listed property group Centuria, the tower at 10 Spring Street was expected to fetch $220 million or more. It is understood Lendlease APPF Commercial is doing the final leg of its due diligence at a price well above expectations. Among the underbidders was Dexus, which bought a half-stake sale in the city's tallest building, the MLC Centre for $722 million in June.
Nufarm Limited (NUF):
Crop protection group Nufarm has set the bar for acquisitions at up to $US1 billion as it assesses opportunities created by global consolidation in the industry. Nufarm chief executive officer Greg Hunt said the Melbourne-based company was looking to acquisitions, which fitted with its strategy of focusing the business on select countries and crops with growth potential. Mr Hunt said Nufarm would not compromise its capital structure by biting off more than it could chew and was highly unlikely to complete a transaction this calender year.
Propertylink Group (PLG):
Propertylink has rebuffed a $573 million takeover proposal from fellow fund manager Centuria, which had established a 17 per cent stake in its target this month. Propertylink has rebuffed a $573 million takeover proposal from fellow fund manager Centuria, which had established a 17 per cent stake in its target this month. The listed Propertylink said the Centuria proposal undervalued its funds management platform and real estate portfolio, and held no premium for control. Led by John McBain, Centuria Capital, the parent fund manager, and one of the listed vehicles it manages, Centuria Industrial REIT, built a combined 17 per cent in Propertylink two weeks ago after a lightning raid. Behind the scenes, it was followed by an initial approach, then an indicative, conditional and non-binding proposal to acquire the remaining units in Propertylink through a scheme of arrangement.
Suncorp Group Limited (SUN):
Australia's sixth largest bank Suncorp has joined the big banks in scrapping unpopular foreign ATM fees. Suncorp has almost 400 ATMs and more than one million customers. The announcement on Tuesday morning followed a series of announcements from the big four banks on Sunday rush to torpedo the fees on Sunday. Suncorp executive general manager Bruce Rush said the regional bank will remove all fees from its ATMs before the end of the calendar year. "Suncorp supports fee-free ATMs and we will implement this change in early December to coincide with other positive changes, including updating technology and enhancing customer experience which is already planned for our ATM network," Mr Rush said. The Reserve Bank estimated that there are some 250 million withdrawals made from foreign ATMs every year. Analysis from Deutsche Bank found that big four's decision will see the banks forgo $117 million in fees each year.
Sydney Airport Holdings (SYD):
Sydney Airport, which runs Australia’s busiest airport, says the head of General Electric Co’s unit in Australia will take over as chief executive in the coming months. The appointment of Geoff Culbert comes after current Sydney Airport chief executive Kerrie Mather said she would step down, prompting the airport to launch a global search for her replacement. Mr Culbert, who has been president and chief executive of GE Australia, New Zealand and Papua New Guinea since 2014, will begin his new role at the airport before the end of January. He will be paid an annual salary of $1.5 million, including superannuation.
South32 (S32):
ASX-listed miner South32 is reviewing its relationship with its auditor KPMG due to a corruption scandal embroiling the big-four accounting firm in South Africa. The scandal revolves around allegations against the billionaire Gupta family, which has extensive business interests in South Africa, and its very close relationship with President Jacob Zuma. It has provoked a political firestorm that has destroyed international lobbying and PR firm Bell Pottinger and deeply wounded KPMG South Africa. KPMG has been forced to admit its audits of Gupta companies “fell well short of the quality expected” and has walked away from a controversial report attacking a so-called “rogue unit” within the South African Revenue Service, which had reportedly been investigating the family. In a statement released a fortnight ago, KPMG International said its South African chief executive and chief operating officers had resigned, five partners “will be leaving the firm” and it would sack the partner in charge of the Gupta audits.
Tabcorp Holdings Limited (TAH); Tatts Group Limited (TTS):
The timetable set down by gambling giants Tabcorp and Tatts to execute their $11bn merger has blown out despite a court win this morning. Justice John Middleton, the president of the Competition Tribunal, granted Tabcorp a speedy re-hearing of its application to approve the merger over the protests of the competition watchdog and James Packer-backed corporate bookmaker CrownBet. However, the dates set down by Justice Middleton — October 24 and 25 — fall after a proposed meeting where Tatts shareholders are to vote on the deal, on October 18, and clash with the date by which Tatts hoped to get court approval, October 24. The meeting and court approval date will need to be rescheduled. In good news for the mega-merger, which has now been underway for almost a year, if the tribunal again approves the deal it will still be possible to consummate the marriage before Tabcorp’s offer expires on December 31.
Xanadu Mines (XAM):
Xanadu Mines is seeking to raise $10 million, with the ability to raise additional funds up to and within the 15 per cent placement capacity of the junior explorer. The offer price of 20¢ represents a 2.4 per cent discount to the last close and a 6.6 per cent discount to the 10-day volume-weighted average price, according to a term sheet sent to fund managers. Xanadu Mines explores and develops various mineral exploration projects in Mongolia. Its flagship project is the Kharmagtai porphyry copper-gold project, located in southern Mongolia. Placement proceeds will be used for exploration activities at Kharmagtai, Red Mountain and Yellow Mountain; repayment of the Noble debt facility; and general working capital.
(Source: AIMS)
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