10/06/2009 - 06:51

Today's Business Headlines

10/06/2009 - 06:51

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Perth climbs office growth ladder but glut is looming; BHP mining contractors facing the axe; Cash crisis for timber investors; JB Hi-Fi tips $2.3bn sales, 41pc jump; Unions split over watchdog

Today's Business Headlines

Perth climbs office growth ladder but glut is looming
Perth has leapt up the list of the world's fastest growing office property markets, with its occupancy costs recording the second fastest growth rate, according to CB Richard Ellis's latest survey. The West

BHP mining contractors facing the axe
Leading mining contractors to BHP Billiton - Leighton Holdings and Macmahon - are to be squeezed out of BHP's Pilbara operations under the $US115 billion ($145 billion) joint venture deal with Rio Tinto, and as part of BHP's response to its poor safety record in the Pilbara. Sydney Morning Herald

Cash crisis for timber investors
The corporate offshoot charged with running Great Southern's managed investment schemes is insolvent and has no cash to complete its forestry and horticulture projects. The Age

JB Hi-Fi tips $2.3bn sales, 41pc jump
Consumer electronics retailer JB Hi-Fi expects its full year net profit in fiscal 2009 to be around $92 million, a 41 per cent increase on the previous year. Daily Telegraph

Unions split over watchdog
Influential union leader Joe de Bruyn has declared Labor does not have a "mandate" to scrap the coercive powers of John Howard's building industry watchdog in its first term, contradicting construction unions, which are leading a national campaign to have the powers abolished. The Australian

 

THE WEST AUSTRALIAN:

Page 4: A surge in business confidence and signs the collapse in the jobs market may be over is adding to hopes that Australia may be past the worst of the global downturn.

Fruit and vegetable growers have begun a fighting fund to stop a Federal award they say would force up prices or push growers out of business.

Page 6: Premier Colin Barnett has revealed he will meet BHP Billiton chief executive Marius Kloppers next week to discuss the company's plans to combine its Pilbara iron ore operations with Rio Tinto.

Eight tardy State MPs who spent a combined $32,000 on overseas and interstate travel have not lodged reports of their trips, despite Premier Colin Barnett warning them last week they had until yesterday to comply.

Page 10: WA's first Lower House Greens MP, Adele Carles, has called for a ban on the live sheep export trade from Fremantle port, telling Parliament yesterday ti was inhumane and no one wanted it.

Page 11: Plans for a housing development on the banks of Moore River near Guilderton, which have a complex history going back more than a decade, have finally been given the go-ahead by the State Government.

Business: BHP Billiton wants to axe contract mining in the Pilbara as part of its plan to merge WA iron ore assets with Rio Tinto and save $US10 billion ($12.7 billion) a year in operating costs.

China's Guangdong Asset Management Group is set to emerge as Kagara's biggest shareholder under a deal that will see the base metals miner raise as much as $210 million.

Atlas iron is poised to become the latest WA miner to test the appetite of equity markets, with plans to raise more than $100 million to fund its growth ambitions.

Carbon capture play Carbon Conscious said yesterday a non-binding deal it signed with an unidentified ASX top-50 company last month was "on track", as rival CO2 Group announced Woodside Petroleum had agreed to expand its emissions offset deal with the group.

ConocoPhillips and Karoon Gas have cashed in on Nexus Energy's woes, contracting a rig originally destined for the Crux field to instead drill the highly anticipated Browse Basin exploration well.

Bank stress tests should be repeated if the US unemployment rate rises beyond levels assumed by regulators in a recent round of examinations that provided relief to markets, according to a bailout watchdog panel.

Shares in discount electronics powerhouse JB Hi-Fi gained as much as 6.5 per cent yesterday after the retailer stunned the market with another full-year earnings upgrade on further cist reductions and continued strong sales.

New Telstra chief executive David Thodey will have to work harder than his predecessor for his money and can be fired for poor performance.

Perth has leapt up the list of the world's fastest growing office property markets, with its occupancy costs recording the second fastest growth rate, according to CB Richard Ellis's latest survey.

A poor reputation as a messy and sometimes dangerous night spot has conspired to keep rents low and vacancies relatively high in Northbridge, but it is an area with a lot of future upside for retail property, according to agents.

Mirvac Group has raised $922 million from an oversubscribed new equity sale to institutions, as it raises cash to repay debt and simplify its business.

 

THE AUSTRALIAN FINANCIAL REVIEW:

Page 1: Superannuation funds are poised to post a double-digit fall in value this financial year in what would be their worst performance on record and almost double the size of last years' decline.

John Young, the founder of agribusiness giant Great Southern Ltd, was saying all the right things. It was February 2005 and the then chief executive was marketing a share sale that would ultimately net him $32.6 million.

Corporate Australia is bracing for a fresh round of profit downgrades as the eocnomic slowdown washes through the balance sheets of companies already battling a cash-flow squeeze, falling orders and constricted credit availability.

Page 3: Insurance companies are placing limits on the amount of work building firms can undertake, undermining government hopes of a construction-led recovery.

Page 4: Jobseekers face an increasingly tough labour market as weak orders and poor trading conditions undermine demand for workers despite signs business confidence is improving.

Page 5: The federal governmetn yesterday shocked the solar power industry by abruptly stopping an $8000 rebate for roof-top panels amid concerns about a blow-out in the scheme that has already cost the governmetn more than $700 million.

Prime Minister Kevin Rudd has defended his cabinet reshuffle against suggestions he neglected some candidates for promotion in order to accomodate the ALP's most influential factions.

Page 7: Big business has urged the federal government to consider further changes to its controversial employee share scheme reforms, warning that they could still lead to companies abandoning their schemes.

Page 9: The opposition is negotiating with independent senator Nick Xenophon and Family First's Steve Fielding in a bid to force the government to allow employers to be compensated if their costs soar due to an overhaul of the awards system.

Prime Minister Kevin Rudd has slapped down the trade union movement over its calls for the abolition of the building industry regulator, saying there were problem elements within the construction union that required specialist industrial policing.

Page 10: Litigation giant IMF is poised to fund a possible class action on brhalf of 3000 investors in two Great Southern cattle projects who swapped their interestsin the projects for shares in the now-collapsed company.

 

THE AUSTRALIAN:

Page 1: Influential union leader Joe de Bruyn has declared Labor does not have a "mandate" to scrap the coercive powers of John Howard's building industry watchdog in its first term, contradicting construction unions, which are leading a national campaign to have the powers abolished.

Elite private schools that boast of their superior facilities were handed hundreds of millions of dollars in taxpayer funding for new libraries, halls and refurbished classrooms yesterday.

Australia's largest construction union has warned of nationwide strikes if an Adelaide building worker is jailed for refusing to be interviewed by the industry watchdog.

Steelmakers and electricity generators are urging the Rudd government to delay a vote on its emissions trading scheme until impacts on key industries are finalised.

Page 2: The tower of edu-babble, or jargon in education, has risen so high that Oxford dons have felt the need to launch verbal missiles at it.

Page 3: The Telstra board, stung by the controversy over Sol Trujillo's disappointing reign, has ensured it will be able to sack its new chief executive without triggering a multi-million-dollar payout if he fails to deliver.

Page 4: Steelmakers and electricity generators are urging the Rudd government to delay a vote on its emissions trading scheme until its effect on the key industries is finalised.

Trade unions are demanding that Julia Gillard step in and ensure Fair Work Australia reviews wage deals that impose a non-union collective agreement and that have been deliberately rushed in before Labor's workplace laws take effect next month.

Page 5: Waiting times for elective surgery at Australia's public hospitals have continued to grow, intensifying pressure on Kevin Rudd over whether to proceed with his threatened federal takeover of the health system.

Business is still confronting recession conditions but executives are increasingly confident they will be enjoying a recovery in six months' time.

New Financial Services Minister Chris Bowen has set his sights on financial advisers' commissions, arguing the industry faces "perceptions" of conflicts of interest.

Page 6: Chicken tycoon Gerardus Gerrit Heijne will be nearly 60 before he is eligible for release from prison after he was sentenced last night to at least 13.5 years for strangling his gay lover.

Page 7: A Current has stepped up an attack on sharp-tongued celebrity chef Gordon Ramsay, accusing him of making sexist and inappropriate remarks to Nine Network staff before being interviewed by Tracy Grimshaw.

Business: Blood products group CSL has walked away from its shot at being the biggest plasma provider in the US, abandoning the $US3.1 billion ($3.9bn) takeover of Talecris Biotherapeutics after hitting a regulatory roadblock.

News Corporation chairman Rupert Murdoch has downplayed the likelihood of Chase Carey, his new deputy chairman, succeeding him while also predicting that newspapers will be paperless within 20 years.

Rio Tinto and BHP Billiton could reap $US20 billion ($25.2bn) in savings from the ambitious plan to combine their huge West Australian iron ore operations -- double the amount previously flagged.

Drillsearch did not get to first base in its attempt to delay today's shareholder meeting by bringing proceedings alleging that two of the directors had breached their fiduciary duties and were party to an illegal attempt to secure control of the company without making a takeover bid.

Japanese steel mills, collectively the largest buyers of Australian iron ore, are calling on their competition regulator to find against the proposed BHP Billiton-Rio Tinto production joint venture.

Karoon Gas, which has run into trouble defining its huge offshore Poseidon find in Western Australia's Browse Basin, is looking to raise up to $150 million in an institutional share placement.

Macquarie Group last night staged a last-minute attempt to derail Chinese group Minmetals' $US1.2 billion ($1.5bn) proposal to buy the main assets of OZ Minerals.

Qantas will save $1 billion in capital expenditure in the next financial year by delaying aircraft deliveries, according to chief executive Alan Joyce.

Construction giant Bovis Lend Lease yesterday confirmed it had received subpoenas from the US Federal Attorney and New York District Attorney regarding allegations of overbilling on the $US700 million ($882m) September 11 Memorial and Museum and other large New York projects.

Paul Wilson has no time to worry about the ETS debate. He's too busy employing people for his solar power business, Clear Solar. He reckons Barnaby Joyce's comments that green jobs are for "building photovoltaic cells and wind chimes in Nimbin" are curious.

The Obama administration wants Europeans to put their banks through more rigorous public stress tests to help ensure that the institutions survive if the economy slips from bad to worse.

The Obama administration is backing away from seeking a major reduction in the number of agencies overseeing financial markets, informed sources say, suggesting that the current alphabet soup of regulators will remain mostly intact.

The Treasury Department expects an initial payback from the US's largest banks of at least $US50 billion ($63.4bn) in bailout funds, according to informed sources, double the amount the government initially expected to recoup.

Fuji Xerox president Tadahito Yamamoto admits it is a struggle to shift his back office experts from their customary focus on manufacturing QCD (quality, cost, delivery), and indeed to shift them out of the back office altogether.

Domestic bond markets are pointing to a sharp recovery for the Australian economy, raising expectations that the Reserve Bank might have to increase interest rates.

Weaker commodity prices and resource stocks pulled the Australian sharemarket down almost 1 per cent, offsetting gains among financial stocks.

 

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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