ABOUT this time last year we published a major feature on the Burrup –depicting the development plans for the North West peninsula as being on a knife edge.
ABOUT this time last year we published a major feature on the Burrup – depicting the development plans for the North West peninsula as being on a knife edge.
At the time, some key sources within the WA Government suggested we were wrong and that everything was hunky-dory. ‘Just wait and see’, we were told.
To be fair, the Government was hardly being bullish.
In September last year, State Development Minister Clive Brown expressed a hope that two of the six projects proposed for the Burrup industrial precinct would have started construction within a year.
You would not have thought this was an overly optimistic projection – only one third to have pressed the button within 12 months.
In fact, when we asked the $6 billion question: “How many of these projects will be built”, even we thought a few of them would get over the line.
But a year on, many in business are wondering just how much this Government is going to achieve with development on the Burrup.
Only one of the six mooted projects has been given the green light.
One of the projects most expected to be a starter, Methanex, collapsed last month – a victim of the rising Australian dollar and, it claimed, parsimonious behaviour by the Federal Government, which had reduced grants available.
With the Aussie dollar continuing to rise, the risk for the remaining projects – some of which were far less solid than Methanex – continues to climb.
Let’s hope a window of opportunity hasn’t been lost.
The big question is, what can the State Government do to turn this situation around?
Unfortunately, the Labor Party doesn’t really have a good record for getting big projects – those that aren’t controversial, that is – to happen.
It may well blame this recent round of failure, such as Methanex, on the Federal Government, but that won’t improve its record.
Perhaps the Federal Government thinks that Labor’s hold in Western Australia is more tenuous than elsewhere.
It could almost seem by design that, by withholding funding for projects and infrastructure in the North West and for restructuring in the South West, Mr Howard’s government is making life difficult for State Labor in the lead up to the next election.
Whatever the case, the State Government has a problem if it can’t make Burrup take off.
Every business knows how fatal it is to over-promise and under-deliver.
Multiplex times its run
THE much-talked-about float of Multiplex Constructions Pty Ltd is under way.
The move to list has its critics but it does seem like a natural step for a family business that has moved into some heavyweight contracting areas, such as the redevelopment of Wembley Stadium in London.
It is also a great opportunity to shift some of the share market’s focus back into Perth, with Multiplex shaping up to be one of the bigger corporate events of the financial year.
In many respects the company could not have got its timing better – going to the market on the back of a property boom and in the midst of a rally.
While the small end of the market is dusting off long-shelved projects to rush them to market, the big end of town can’t move so quickly.
No doubt there was some good advice there from Poynton and Partners executive chairman John Poynton, who is playing a role in managing the marketing effort as well as from UBS, which holds the lead corporate advisory role and will distribute a big amount of stock through Bell Potter Securities.
Mr Poynton will be one of at least three independent directors on a board dominated by Roberts family members (at least three members including patriarch John as chairman, managing director Andrew and head of the development division Tim) and current Multiplex executive directors Ross McDiven, John Corcoran and Noel Henderson.
The other known independent directors will be investment and commercial banker Allan McDonald – who is currently on the boards of Julia Ross Recruitment, General Cologne Re Australia, Billabong International, TAB and Brambles Industries – and Peter Dransfield, who has worked in excutive roles at Australand Holdings, Long Corporation and been the NSW director of housing.
