Big Deals

Ever wanted to look at the on-market trades of Australia’s rich and famous? Well, today we take a look at some of the transactions conducted by the biggest names in Australian business. Separately, we take in some very astute and some very contrarian plays by Australian fund managers.
Directors in Australia’s biggest resources companies have been among those most active in the market this week. On August 23 and August 29 the general manager of BHP Billiton, Phil Aitken, sold 47,000 shares in the Big Australian for $1.3 million. A day later, on August 30, a director of Iluka (ILU) Keith Folwell sold a parcel of 27,000 in the company for $195,000.

James Packer, perhaps the biggest name in Australian business, has been busy reorganising his affairs. One of his many investment vehicles, Snowlove Pty Ltd, sold a parcel of 73,000 shares in Publishing & Broadcasting (PBL) on August 25. Perhaps coincidentally, Snowlove bought exactly 73,000 shares in Publishing & Broadcasting in late 2004 in what was his first direct holding in the company.

The ears of AFL tragics will prick up when they hear that Essendon on baller James Hird has taken possession of 130,000 shares in National Leisure & Gaming (NLG) for 37¢ each. The transaction was completed on August 30 for $49,000.

Another “big league” transaction made that day was the sale of 160,000 Alinta (ALN) options. Bob Browning, Alinta’s chief executive, was behind the trade and picked up $1.7 million for his trouble.

Colin Goldschmidt, managing director of Sonic Healthcare (SHL), has acquired a significant parcel of equity in his own company, including 20,000 shares and a million options. After peaking on September 29, 2005, at $16.06, the stock has come off the boil, changing hands for $12.09 on August 31, 2006. Goldschmidt’s trades were reported to the ASX on August 22 as part of an executive investment scheme.

Also this week, there has been a transfer of shares from one well-known business identity to another. A staple of the Australian business scene, Robert Champion de Crespigny has transferred a million options in Babcock & Brown Capital (BBC) to Kerry Roxburgh, Babcock & Brown Capital’s executive director.

Another familiar face that has been actively trading is Craig Kimberley. He was the brains behind the successful retailer the Just Group, before selling his 60% controlling stake in 2004. On August 25, and August 28 Kimberley sold 17,000 shares in the Gazal Corporation (GZL) for $39,950.

Despite a slow week for most of the institutions, there were a few big plays that you should be aware of. Last week it was reported that one of the biggest fund managers in the world had raided the register of the $230 million pizza delivery service Domino’s Australia (DMP). Fidelity now owns about 11% of Domino’s. This week the savvy fund management group Orion Asset Management lifted its own holding in the operation from 6% to 7.2%. Orion bought 700,000 shares for $2.7 million.

It has been reported that between July 18 and August 25 the Australian fund manager Perpetual was quietly building a stake in the Victorian based gaming operator Tattersall’s (TTS). At the time Queensland’s Unitab (UTB) was in play but the NSW based Tabcorp (TAB) was the front runner. Since then the ACCC has scuttled the proposed merger of equals and Tabcorp has withdrawn its bid, leaving Tattersall’s in the box seat. Perpetual paid $115 million for 36 million shares or 5.1% of Tattersall’s.

On the contrarian side of things, we noticed three deals this week that seem to be flying in the face of the market. The NAB announced to the exchange on August 29 that it had been built a $39 million stake in Boral between June 21 and August 25. Boral has plummeted about 30% since May, falling from $9.90 on May 10 to $6.80 at the close of trade on August 31.

Separately, Harris Associates announced it had invested $30 million into Ansell over the same period. Ansell was trading for $11.95 on April 5 before falling as low as $8.15 on July 7. The stock has since recovered some ground and was trading for $9.42 on August 31. Coca-Cola Amatil (CCA) is another stock that has softened considerably over the past 18 months. Schroeder Investment Management clearly thinks there is some hidden value in the company and between April 1 and August 26 invested $79 million in the beverages maker.