A strange thing about Australian business reporting is that its often full of gossip and name dropping as any third rate scandal magazine.
In a perverse way, treating business executives like the Kardashians gives the average mug punter – and shareholders – a glimpse into how these companies do business. Like this story in the Australian Financial Review;
Hamish Tyrwhitt was unaware of the latest drama unfolding within the Leighton board as he relaxed in the Qantas First Class Lounge in Sydney on Friday morning.
Indeed, the contractor’s chief executive officer was busy chatting to former Wallabies captain John Eales while waiting to board a flight to Hong Kong where he was due to close a recent deal to build the Wynn Cotai hotel resort in Macau and enjoy the Sevens rugby tournament.
The timing was not good. Tyrwhitt had only just boarded the flight when the news broke that chairman Stephen Johns and two directors had resigned. Tyrwhitt was forced to change his plans and is expected back in Sydney for a board meeting convened this weekend.
Nice work if you can get it.
A few pages further in the day’s AFR is another gem;
One July evening about four years ago, off the south coast of France between Cannes and St Tropez, two men sat in the jacuzzi on the top deck of a 116-foot Azimut motor yacht. It was about 3am and the sea was rough. The spa water was sloshing about and had given the latest round of caprioskas a distinctly bitter taste.
Dodo boss Larry Kestelman was telling his good friend, M2 Telecommunications founder Vaughan Bowen, about the challenges of growing his internet service provider business.
It’s tough doing business when the spa waters are choppy. One expects better from a seven million dollar boat.
That second article raises another point that’s often overlooked, or unmentioned, when reporting Australian business matters.
on Thursday the 14th, something unexpected happened. At 12.30pm, after no activity all morning, shares in the thinly traded Eftel started to rise sharply. By the time the market closed at 4pm, Eftel had soared 44 per cent to 39.5¢. Someone with knowledge of the deal was insider trading.
Insider trading? On the Australian Security Exchange? Somebody had better call those super-efficient regulators who were responsible for Australia cruising through the global economic crisis of 2008.
Somebody obviously wanted their own 116ft luxury yacht or corporate box at the Hong Kong Sevens.
Both of these stories illustrate the hubris and privileges of corporate Australia and its regulators.
One wonders how well equipped these organisations are for an economic reversal when their leaders are more worried about caprioskas and their spots in the first class lounge.
We may yet find out.
First class airline seat images courtesy of Pyonko on Flickr and Wikimedia.
Any fool can make money in a rising market. Recessions are where the amatuers get found out.
One suspects an Australian recession is going to be an interesting time. I’m watching how it will pan out with the superannuation funds.