From rock hunting to riches

A NEED to leave the nomadic lifestyle of a geologist sparked arguably one of the most successful business careers in WA.

Wesfarmers managing director Michael Chaney began his working life as a geologist in the petroleum sector.

He worked for eight years in the industry in Australia and the US.

“I wanted to settle down. I couldn’t see that happening in the petroleum industry,” Mr Chaney said.

“I was also starting to find the commercial side of life interesting.”

After completing a Masters of Business Administration degree part-time at the University of Western Australia, Mr Chaney moved into investment banking with the Australian Industrial Development Corporation.

His first steps in the industry were largely petroleum industry-based.

Mr Chaney was transferred from the bank’s Sydney office to set up its operations in WA. At that time Wesfarmers was one of its biggest clients.

He joined the then agribusiness cooperative as its company secretary, before becoming its financial director.

Mr Chaney was with the company when it corporatised and became its managing director in 1992.

He is also a board member of BHP. It was speculated he was in line for the top job when previous managing director John Prescott resigned but quickly scotched those rumours.

“I told the BHP chairman early on I wasn’t interested in the job,” Mr Chaney said. Neither he, nor his wife, were keen to leave WA.

“Besides, there were also a lot of opportunities with Wesfarmers I wanted to pursue,” Mr Chaney said.

Wesfarmers is WA’s third largest public company, according to the soon to be released Business News Book of Lists. Mr Chaney said Wesfarmers tended to be more financially focussed than operations focussed.

“We have no interest in becoming the biggest agribusiness operator in Australia or whatever. We are more interested in bringing the best return to shareholders that we can,” he said.

“We’re fairly dispassionate when it comes to acquisitions.

“If we can’t get if for what we believe it’s worth, then we won’t get it.”

To date Wesfarmers has been the bridesmaid in several major acquisitions, bidding unsuccessfully for SGIO, Perth Airport and most recently, AlintaGas.

“We’ve actually bidded for a lot more things than people are aware of,” he said.

However, losing out on those much-publicised acquisitions has not hurt the company’s bottom line, posting a record $201 million profit this year.

Mr Chaney said this profit growth was due to strong increase in a number of the conglomerate’s divisions.

Hardware, forestry products, energy and Wesfarmer’s rural arm Dalgety all showed strong growth.

The company is again on the acquisition trail with a bid for Westrail Freight as part of the Australian Railroad Group with Genesee and Wyoming Australia.

Mr Chaney said it was likely the company’s profit would drop next year, probably due to the fall off in spending due to the GST. However, he expects the Bunnings juggernaut to keep rolling on.

Mr Chaney probably has one of the better consumer understandings of the hardware market. His hobby is woodwork – in particular the creation of furniture.

Besides his domestic offerings Mr Chaney has turned out an altar for Christ Church and conference tables for Notre Dame University and the Child Health Research Institute.

Geology also remains a hobby. Mr Chaney admitted to missing the industry for the first couple of years of his corporate life.

He said the future held more of the same.

“There are still plenty of opportunities here. I’m still finding the job pretty interesting.”

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