BREAKFAST DEALS: Packer swoops
James Packer, Scoopon.com.au, Catch of the Day
James Packer seems to have developed a taste for online deals with the casino and media mogul reportedly set to snare a substantial stake in two of Australia's most successful online retail channels, Catch of the Day and Scoopon.com.au. According to The Australian Financial Review, Packer is in advanced talks with Scoopon and Catch of the Day co-founders, brothers Gabby and Hezi Leibovich, with regards to taking a 40 per cent stake in the websites. A deal is expected to be finalised by the end of next week and the paper adds that Packer's offer values the overall Leibovich business at about $200 million. The deal talk comes hot on the heels of Packer's maiden foray into online retail last month after his fund management company, Ellerston Holdings, picked up a piece of Deals Direct for $10 million. Scoopon and Catch of the Day are much bigger fish than Deals Direct and it will be interesting to see what price the Leibovich brothers, who know they are sitting on a good thing, are willing to accept from Packer. Meanwhile, there is also some news on the casino front, with Packer's Crown Limited reportedly set to greenlight a $100 million expansion of Crown Casino in Melbourne. According to The Australian, Crown's board has signed off on the package to develop a new gaming facility, designed to lure in a younger crowd, and a new food and beverage area.
Leighton Holdings, Grupo ACS, Wal King
Construction giant Leighton Holdings' management looks set to face some tough questions next week from its major shareholder Hochtief and Spain's Grupo ACS, which is the new controlling shareholder of the German construction outfit. ACS' conquest of Hochtief would see the Spanish construction giant make significant changes to the German company's supervisory board and that could have serious implications for Leighton. According to Fairfax papers, Hochtief and ACS are set to sign a formal peace deal this week that will not only see ACS nominees take board seats at Leighton but could also see the return of former Leighton supremo Wal King. Hochtief's new chief executive Frank Stieler is set to arrive on Australian shores next Monday and it looks like he will be accompanied by the corporate general manager of ACS, Angel Garca Altozano, who is likely to take a board seat at Leighton. ACS will want to have a heart-to-heart with Leighton chairman David Mortimer and CEO David Stewart in the wake of the company's shock writedowns and the drums are beating louder than ever that the Spaniards may be keen to appoint King as a non-executive director at Leighton to clean up the mess. Now there are many out there who reckon that King should shoulder some of the blame for Leighton's current woes, but many Leighton investors have already called for Mortimer's head and ACS may see King as his obvious replacement. King's departure from Leighton in September last year was clouded in acrimony between him and Hochtief – and while he and his successor Stewart presented a picture of goodwill at the time, King's possible return would no doubt lead to a tense boardroom at Leighton.
UGL, Transfield Services
Talks of a tie-up between engineering services group UGL and Transfield Group have been revived again with reports that the two are keen to discuss a possible merger. UGL had made an initial approach to Transfield's board in February last year only to see it knocked back but The Australian reports that Transfield may be a bit more receptive this time around. UGL's boss Richard Leupen hasn't made any bones about using his healthy balance sheet to make acquisitions and a combination with Transfield will see hefty cost savings. Things may be on the drawing board for now but the right price from UGL could open the door to more concrete talks between the parties.
Macquarie Group, Carlyle Group, Redflex Holdings
It looks like Macquarie Group and private equity outfit Carlyle Group's $303 million offer for traffic safety firm Redflex Holdings is set to hit a roadblock, with talk that the target's suitors are yet to be convinced by the sweetened offer. The key voice of opposition is coming from former Redflex chairman Christopher Cooper, who holds a 11 per cent stake in the target and has been quick to point out over the weekend that the deal is just now sweet enough. Now, Cooper reportedly still holds a substantial sway over a Redflex's registry and has enough shareholder support to block the deal. The scheme meeting for the transaction is set for today.
Wrapping up
Foster's Group's beer business, Carlton and United Breweries, is set to launch its new face tomorrow with the Foster's logo reportedly set to take the back seat. According to The Age, Foster's is putting the finishing touches on the new CUB signage, which emphasises the CUB name, rather than Foster's, and which will be placed at company offices and breweries across the nation. Speaking of things less cosmetic, Chinese brewery Tsingtao has again been touted as a possible contender for Foster's beer business now that the demerger is complete. Tsingtao has played down the speculation but Chinese companies are increasingly active in the food and beverage scene and Tsingtao will no doubt be keen to participate if and when the M&A action around CUB begins in earnest. Speaking of revamps, Virgin Australia has renegotiated its licensing agreement with Sir Richard Branson's Virgin Group to use the Virgin name for the airline's new look domestic operations. Finally, there is speculation that Woolworths may be eying off parts of Solomon Lew's clothing retail portfolio to get a leg up on its arch-rival Wesfarmers. According to the AFR, there is talk that Woolworths may use its dominant position in Westfield shopping centres as leverage to strike a favourable deal on rent for any retail stores it may take from Lew's portfolio.
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