As the sharemarket gears up for more than $4 billion of listings in the next 12 months, the billionaire media mogul Bruce Gordon is understood to be assessing the appetite of the market for media stocks with a view to listing his private media empire, the WIN Corporation, next year.
The growth of Gordon's wealth has been nothing short of extraordinary. From humble beginnings as a magician, he moved to a big career at Paramount Studios, building wealth with assets across the world. It took more than waving magic wands to amass his fortune, estimated at $1.3 billion in the latest BRW Rich List.
While most media companies have had a shocking 12 months with advertising revenue down and audiences being shellacked by disruptive technologies, Gordon's magic seems to have defied the trend for his regional media network. The company's consolidated revenue for the 2008-09 year is estimated to be down just 1 per cent, compared with up to 12 per cent across the TV industry. Operating profits, excluding abnormal items, jumped 14.5 per cent for the year.
You can almost hear the sales pitch of the financial advisers now: WIN Corp both GFC proof and immune to the structural changes that continue to fragment audiences and slash the revenue streams of traditional electronic media outlets.
Sitting on a private media empire that includes the regional WIN TV network, Nine Network stations in Perth and Adelaide, pay-TV company SelecTV, TV program producer Crawford Productions, and a 12 per cent stake in the Ten Network, Gordon has the potential to create a powerful listed entity and provide an alternative to the traditional media companies which fund managers and index funds invest in.
But it isn't all sunshine and roses for Gordon. Apart from being embroiled in a legal battle with the former WIN Corp managing director, David Butorac, who is suing him for termination benefits, bonuses, damages, interest and costs, Gordon will be prepping himself as a likely witness in a number of sizzling trials to resume in Italy involving his good friends and business associates the controversial Italian Prime Minister, Silvio Berlusconi, and the Hollywood producer and distributor, Frank Agrama, over alleged tax fraud.
The trials were suspended last year when Berlusconi introduced a law that gave Italy's four most senior officials, including the prime minister, immunity from prosecution.
But after Italy's highest court lifted the immunity earlier this month, Bloomberg and other media outlets suggest one of the cases that may be revived is an accusation of tax fraud by Berlusconi in buying film rights for his Mediaset TV empire.
This trial would undoubtedly call Gordon as a witness because of his association with Berlusconi and Agrama when Gordon was president of Paramount International Television Distribution in the 1980s and 1990s. Gordon was unavailable for comment and his son, Andrew, executive chairman of WIN, declined to comment. No allegations have been made against Gordon.
BUNKER FOR CHIP?
Rumours are rife in Asia that the former BHP Billiton chief executive Chip Goodyear is considering taking a board position at Woodside Petroleum, which is chaired by Michael Chaney, a former director of BHP.
Such an appointment makes a lot of sense given Goodyear is footloose and fancy free after Singapore's state investment arm, Temasek, rescinded his appointment as its new chief executive in July due to differences over strategy .
It might also rekindle talks between the two companies on merging their petroleum operations to create a business worth close to $100 billion, which would rank it as one of the biggest oil and gas businesses in the world and give Australia real clout. Both companies have parallel exploration strategies in several areas, including West Africa and the Gulf of Mexico.
BHP has looked at Woodside several times, the first being a proposed merger in 2001. Talks fell apart over an inability to agree on the transfer of value, strategy and control mechanisms within a merged group.
The two companies are believed to have resumed talks in 2002 with the Shell Group agreeing to sell its 34 per cent stake to BHP but continuing to operate it. The deal failed for two reasons: the then BHP Billiton chief executive Brian Gilbertson was not a strong believer in petroleum and the board, chaired by Don Argus, knocked it back on the basis it would cut earnings per share for two years.
But this is a new era. BHP has a new chairman, Jac Nasser,a new chief executive, Marius Kloppers, who is undoubtedly fishing around for another deal, and energy assets are the flavour of the month.
Woodside declined to comment on the Goodyear speculation.
Frequently Asked Questions about this Article…
Is Bruce Gordon planning to list WIN Corporation on the sharemarket?
According to the article, billionaire media mogul Bruce Gordon is understood to be assessing market appetite to list his private media empire, WIN Corporation, next year. This was reported amid expectations of more than $4 billion of listings over the next 12 months, but no final decision or confirmed timetable was provided.
What assets would be part of a potential WIN Corporation listing?
The article says Gordon's private media empire includes the regional WIN TV network, Nine Network stations in Perth and Adelaide, pay-TV company SelecTV, TV producer Crawford Productions, and a 12% stake in the Ten Network—assets that could form the core of a listed WIN Corporation.
How did WIN Corporation perform financially during the 2008–09 year?
WIN's consolidated revenue for the 2008–09 year was estimated to be down just 1%, compared with up to 12% declines across the TV industry, and operating profits excluding abnormal items were reported to have jumped 14.5% for the year.
What legal or reputational risks could affect a WIN Corp IPO?
The article highlights two potential risk factors: a lawsuit by former WIN Corp managing director David Butorac, who is suing Bruce Gordon for termination benefits, bonuses, damages, interest and costs; and the fact Gordon could be called as a witness in revived Italian trials involving Silvio Berlusconi and Frank Agrama over alleged tax fraud. The piece notes no allegations have been made against Gordon himself.
Why might investors be interested in a listed WIN Corporation compared with other media stocks?
The article suggests WIN Corp has shown resilience during a tough year for media companies—minimal revenue decline and rising operating profits—and that packaging Gordon's regional and production assets could create a powerful listed alternative to traditional media companies that fund managers and index funds currently invest in.
Who are the key people mentioned in connection with WIN Corporation?
Key people named in the article are Bruce Gordon (owner of WIN Corporation), his son Andrew Gordon (executive chairman of WIN, who declined to comment), and former managing director David Butorac (who is suing Gordon).
What are the rumours about Chip Goodyear and Woodside Petroleum?
The article reports rumours that former BHP Billiton CEO Chip Goodyear is considering a board position at Woodside Petroleum after Temasek rescinded his appointment as its chief executive. The story says such an appointment could make sense and might rekindle merger talks between Woodside and BHP.
Could BHP Billiton and Woodside merge to create a major oil and gas business?
The article notes speculation that a BHP–Woodside merger could create a business worth close to $100 billion, giving Australia significant clout. It also explains that BHP has considered Woodside several times (notably in 2001 and again around 2002) but prior talks failed over issues like value transfer, strategy and earnings-per-share impact. The piece frames any renewed talks as possible but not confirmed.
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