DataRoom AM: NAB’s UK exit sign

The resignation of Clydesdale Bank’s boss is a sign NAB is closer to exiting the UK, while a snap election in Queensland is set to hasten the sale of the state’s power assets.

National Australia Bank has made no secret of its desire to accelerate its exit from the UK and it now appears clear a departure is not too far from becoming a reality.

Elsewhere, Queensland premier Campbell Newman gets on the front foot in the national privatisation race, investors again bet on a Santos capital raising and regional airline Skytrans shuts up shop.

The head of Clydesdale Bank -- National Australia Bank’s key UK operation -- has announced plans to leave the business, citing an impending NAB exit from the region as a key factor in the decision. David Thorburn, who incidentally is not related to NAB boss Andrew Thorburn, said the Australian bank was pushing for a five-year commitment from him in a sign NAB wants a fully committed management team to spruik to would-be investors in an IPO.

The news may present a slight delay to any float as NAB works on finding a successor, but nonetheless outlines the bank’s commitment to push forward with a potential £2 billion ($3.7bn) IPO this year.

NAB isn’t the only big name pressing ahead with asset sales as Campbell Newman opts for an early poll that is expected to deliver a mandate for a power sell-off in the state. The January 31 election will be key to kickstarting $30bn of asset sales in Queensland and, provided Newman’s LNP wins out, should ensure the Sunshine state beats NSW in the race to be first to market with highly sought-after power infrastructure.

First on the chopping block will be transmission network Powerlink, with a long-term lease potentially reaping close to $10bn.

Meanwhile, investors are again showing concern that energy giant Santos will be forced to raise cash as an ongoing slump in oil prices hurts cash flow while it looks to complete its flagship LNG project in Queensland. The firm’s stock sunk almost 9 per cent on Tuesday and, while it has recently cut its capex budget and received a new loan facility, JPMorgan is warning of a fresh cut to Santos’ credit rating, according to The Australian Financial Review.

Should a cut eventuate, it would leave Santos just one notch above junk status and may force the company’s hand on a capital raising.

In aviation, regional airline Skytrans has called in administrators, informing customers that the recommencement of flights is unlikely in the “short to medium term” after it lost a key government contract last year. The north-Queensland based operation had served the region for 25 years and carried its last passengers on Friday.

Finally, Kaizen Capital is hoping to secure $20 million through a new global equities fund that will appear on the second-tier National Stock Exchange in March, according to the AFR.

InvestSMART FORUM: Come and meet the team

We're loading up the van and going on tour from April to June, with events on the NSW central & north coast, the QLD mid-north coast and in Perth, Adelaide, Melbourne, Sydney and Canberra. Come and meet the team and take home simple strategies that you can use to build an investment portfolio to weather any storm. Book your spot here.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles