Today's Business Headlines

17/12/2008 - 06:50

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Banks agree to extend Centro's $5bn debt; CBA seeks $2bn in late dash for cash; Industry revolt on green plan; Telstra hit again; Burrup counts the cost as gas supply comes back on stream

Today's Business Headlines

Banks agree to extend Centro's $5bn debt
Banks last night agreed to give Centro Properties Group a lifeline involving a two-year extension of debt and a provision for equity. The Australian

CBA seeks $2bn in late dash for cash
Commonwealth Bank of Australia has received a $2 billion injection of equity in a move aimed at allaying concerns about the state of its balance sheet amid funding pressures and an anticipated increase in bad debts. The Fin Review

Industry revolt on green plan
Heavy industry is demanding further concessions in the Rudd government's modest emissions trading scheme, saying it will still cost jobs, stymie investment and exacerbate the effects of the economic slowdown. The Australian

Telstra hit again
Investors have shown their displeasure with Telstra by stripping more than $7 billion from its market value in just two days. Herald Sun

Burrup counts the cost as gas supply comes back on stream
Indian fertiliser tycoon Pankaj Oswal says the forced shutdown of the Burrup Peninsula ammonia plant after the Varanus Island gas plant explosion had cost his business up to $US250 million ($373 million). The West

 

THE WEST AUSTRALIAN:

Page 1: Local government councillors would be paid, full-time workers who were elected in a first-past-the-post system under a radical plan being considered by the state government.

Page 4: Kevin Rudd's watered-down carbon trading plan appears set to clinch bipartisan support after Liberal MPs welcomed the Prime Minister's "back-pedalling" on his pre-election position.

Climate Change Minister Penny Wong has defended the structure of the compensation package that will see some households make money from the emissions trading scheme.

Page 9: More than 500 migrant workers brought into the state on temporary visas to fill job vacancies created by chronic labour shortages during the boom have been sacked in the past two-and-a-half months as the global slowdown hits WA's economy.

Page 10: Contractor BGC is expected to demand about $110 million in cost overruns on the Arena indoor stadium next week, taking the cost of the project to about $425 million.

Page 11: The Reserve Bank board will take a summer break from cutting interest rates, according to its latest minutes, to assess the effects monetary policy has had on the economy over the past four months.

The US government is considering handing its ailing domestic car industry up to $US40 billion ($60 billion) in funding as it tries to ascertain the exact extent of the companies' financing needs.

Page 12: Telstra's board is under intense pressure after the company's share price tumbled for the second day yesterday following the Rudd government's shock rejection of its bid to build a national broadband network.

Business: Indian fertiliser tycoon Pankaj Oswal says the forced shutdown of the Burrup Peninsula ammonia plant after the Varanus Island gas plant explosion had cost his business up to $US250 million ($373 million).

Embattled shopping centre owner Centro Properties has been thrown a three-year lifeline in a $5 billion-plus deal involving hybrid convertible notes and a debt-to-equity swap.

The auditors to Bernard Madoff's $US50 billion ($75 billion) exclusive fund should have sent alarm bells ringing in the minds of the individuals, charities and hedge funds who often fought hard to gain access to his 10 to 12 per cent annual returns.

PBL Media has secured a $445 million lifeline from its private equity owners in a deal that will lower its $4.2 billion debt and end its long-standing ties with the Packer family, which has dominated Australian media over three generations.

Commonwealth Bank of Australia last night raised $2 billion through a share placement aimed ay bolstering its balance sheet.

Yilgarn Infrastructure chairman John Saunders and fellow shareholders shared $11.7 million in dividends last year after the one-time proponent of an iron ore port at Oakajee cashed in on soaring mining company share prices.

Fortescue Metals Group yesterday defended its decision to axe long-term shipping contracts after it emerged that one had taken the Pilbara iron ore miner to court seeking millions of dollars in damages.

Inpex wants to sell a slice of its $25 billion Ichthys liquefied natural gas project in the Browse Basin off WA's North West to other Japanese companies to cut risk and funding needs.

THE AUSTRALIAN FINANCIAL REVIEW:

Page 1: Commonwealth Bank of Australia has received a $2 billion injection of equity in a move aimed at allaying concerns about the state of its balance sheet amid funding pressures and an anticipated increase in bad debts.

An audit of the $22 billion defence budget has recommended the Rudd government double its annual savings target to $2 billion to curb waste and cost overruns amid the tightening economic conditions.

The Reserve Bank of Australia hopes its aggressive interest rate cuts and the government's spending will cushion the economy into the new year, as it uses the Christmas break to assess the effect of stimulus already put in place in response to the global downturn.

Page 3: Large retailers have urged Workplace Relations Minister Julia Gillard to delay the Australian Industrial Relations Commission's overhaul of awards, warning the proposed changes will drive up wage costs when retailers are grappling with record low consumer sentiment.

Rural water trading between states is being stifled by red tape that can delay transactions by months and has practically stopped interstate sales of water licenses, despite repeated pledges by state governments to remove restrictions.

Page 5: Prime Minister Kevin Rudd yesterday defended his policy on climate change by acknowledging for the first time that he softened his ambitions in response to the global financial crisis.

The heavy polluters whose earnings were most under threat by the introduction of an emissions trading program now look set to emerge from the new scheme largely unscathed, analysts say.

The economist commissioned by opposition leader Malcolm Turnbull to review the government's emissions trading white paper says it would be good if petrol prices rose highers and a "disaster" was to leave fuel out of the scheme.

Page 7: Business and tax experts said the investment allowance introduced by the federal government would expire too quickly for large firms to boots their capital expenditure and would not stimulate the economy as intended unless it was extended and increased.

Page 9: US regulatory authorities have already begun the task of liquidating Bernard Madoff's brokerage firm after the Wall Street veteran was charged with a $US50 billion ($76 billion) fraud that has ensnared some of the world's biggest banks.

Page 12: PBL Media breathed easier yesterday after its lenders agreed to water down the terms of its loan agreements in exchange for an equity injection from its private equity owner, CVC Asia Pacific.

It's unlikely Telstra shares will make a strong recovery before late next month, and investors and analysts are now more concerned about the group's business in the mong-term after it was excluded from the national broadband network tender by the government.

THE AUSTRALIAN:

Page 1: Heavy industry is demanding further concessions in the Rudd government's modest emissions trading scheme, saying it will still cost jobs, stymie investment and exacerbate the effects of the economic slowdown.

Higher education is set for a $7 billion overhaul aimed at boosting graduate numbers by 330,000, tightening quality controls, merging some regional universities and turbo-charging research and development.

The global recession struck Queensland mining towns yesterday, with nearly 550 workers being stood down, more than 400 of them from the rich coalfields around the Bowen Basin.

Page 3: A lawyer who won the right to serve legal documents on two defendants via Facebook says courts around the country will follow his lead.

Page 6: The first sign of consumer optimism has emerged from the gloom of the financial crisis, with the majority of people pledging to spend the Rudd government's cash bonus in the lead-up to Christmas.

Pressure is mounting on Telstra chairman Donald McGauchie and chief executive Sol Trujillo to take responsibility for wiping $7.5 billion off the group's market value, after being responsible for Telstra's surprise early exit from the national broadband network tender.

Business: Banks last night agreed to give Centro Properties Group a lifeline involving a two-year extension of debt and a provision for equity.

Commonwealth Bank has closed the capital gap with its rivals by raising $2 billion in an institutional share placement, while warning that credit conditions will continue to deteriorate.

The global financial crisis has suddenly worsened for Australia's mining sector, which yesterday slashed 545 jobs in Queensland and began to slash production of coking coal, the nation's most valuable export.

Rio Tinto has been urged to merge its huge Pilbara iron ore operations with rival and former suitor BHP Billiton, and hand over management to help reduce high debt levels.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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