THE proudest moment in the career of this reporter was being called a f---wit by Qantas chief executive Geoff Dixon at an investor presentation a few years back. Sadly, we were not there to enjoy this panegyric firsthand. Being called a f---wit by Geoff is the highest commendation. There is no more ringing endorsement of one's professionalism than to be ennobled as a f---wit by Geoff.
Geoff had been responding to questions about a story that showed some 20 per cent of Qantas's bottom-line profit was in fact capitalised expenses on software and the like - smoke and mirrors, if you like.
Anyway, Geoff is rather fortunate that the leveraged buyout he cooked up for Qantas - in league with Macquarie and Allco - fell at the final hurdle.
Strapping on $10 billion in "covenant lite" debt at the cusp of the credit meltdown in 2007, and plonking in the soon-to-croak Allco as cornerstone shareholder, would have seen the national carrier back in national hands in very short order.
Mind you, although Geoff's $11 billion bid with $10 billion in debt might have been a dodgy deal for government, the airline, employees and taxpayers, it was a ripper for shareholders.
Pitched at $5.45 a share - compared with the $1.35 share price now - it would have prevailed had it not been for one US hedge fund manager who suspected Macquarie was trying to leg him over, and so refused to sell into the offer at the 11th hour.
Fast-forward five years, Geoff's mate and protege Alan Joyce has succeeded him at the helm of Qantas and this week came the dramatic news of the shattered friendship.
Alan is cross because Geoff has been niggling him. Geoff, you see, is tied up with an agitator's group that reckons it can drum up a takeover for the airline.
So Alan engaged the thermonuclear option. In a bid to flush Geoff out, he pulled Qantas' and Jetstar's $40 million in funding for Tourism Australia. Geoff is chairman of Tourism Australia.
Alan had invoked the thermonuclear option in his brawl with the unions last year. He grounded the airline. And it worked.
This time, it looks petulant. It takes Geoff and his mates Singo, Mark Carnegie and Peter Gregg too seriously. The lads are pretty good at getting yarns in the press mooting what they might do if they had a lazy $3 billion. That's a far cry from a credible offer for the national carrier.
Singo and Carnegie are linked to every second deal in town. Carnegie is particularly ubiquitous, having just turned up as a dissident in the Gold & Copper Resources claims against mining giant Newcrest. And only this week he jagged a bizarre proxy from Perpetual to do its agitating in the Brickworks kerfuffle.
Gregg is the former Qantas CFO and more recently the finance man at Leighton Holdings. Between them, they speak for 1.5 per cent of the stock.
Joyce has moved to flush them out, but really this is an agitators' game, a slow burn. The aim is to build a credible Qantas alternative management and garner the support of the institutions.
The moral of the story is that there will be many more agitators' plays such as these. Deal volumes are down, debt and equity finance is scarce and there are a lot of old rich blokes about who can't stand the thought of retirement.
BACK in the day, they didn't put up with this nonsense! Bring back the good old State Electricity Commission!
Those balding, be-cardiganed bureaucrats would never have allowed price rises of 5 per cent, let alone 17 per cent a year!
Not when they had to trudge up to parliament and explain themselves. Not on your nelly.
Back in the day there was accountability! But what did they do? They blew up that old State Electricity Commission - to smithereens.
Now we've got generators, retailers, regulators, distributors, transmission providers corporate empires everywhere, teeming with fat cats, each with their own board, their HR, their PR, their lobbyists, their consultants.
And they call that progress!
If that lot went up to Senate estimates to explain why prices rose 100 per cent in five years, it would be busier than Tahrir Square in Cairo. They'd have to break out the tear-gas just to stop them blaming each other.
Back in the day they didn't have lobbyists, they had tea ladies. Back in the day - before they corporatised, incentivised, privatised, capitalised, computerised, demergerised and rationalised - there was common sense!
Back in the day, banks didn't rob people, people robbed banks. Back in the day, before they gave people Clean Energy Payments to spend on the pokies, they didn't have water coolers, they had a sink!
Back in the day, they were called merchant bankers, not investment bankers. And nobody had even dreamed of an automated voice message that said: "Your call is important to us."
And now we have smart meters! Say no more.
Frequently Asked Questions about this Article…
What sparked the public clash between Qantas CEO Alan Joyce and former CEO Geoff Dixon?
The clash escalated after Geoff Dixon became linked with an agitators' group reportedly exploring a takeover of Qantas. In response, Alan Joyce pulled Qantas and Jetstar's $40 million in funding for Tourism Australia — where Dixon is chairman — in an effort to flush Dixon and his allies out of the lobby and media campaign.
Who are the 'agitators' mentioned in the Qantas dispute and how much of the stock do they hold?
The article names a group of prominent investors including Singo, Mark Carnegie and Peter Gregg as part of the agitators' movement. Together they are reported to speak for about 1.5% of Qantas stock. Their approach is described as a slow-burn effort to build an alternative management team and win institutional support.
How could activist or agitator campaigns affect everyday Qantas shareholders?
Agitator campaigns can create media noise, boardroom disputes and pressure on management, which may influence investor sentiment and share price volatility. The article highlights that these campaigns aim to assemble credible alternative management and institutional backing — developments everyday investors should watch because they can affect corporate strategy and long-term value.
Why did the author suggest there will be more agitator plays like the one at Qantas?
The piece argues that deal volumes are down, debt and equity financing is scarcer, and there are many wealthy individuals unwilling to retire. That environment, combined with fewer traditional deals, makes activist or agitator plays more likely as an outlet for those investors seeking influence or change.
What historical context about Geoff Dixon did the article provide that investors might find relevant?
The article recalls Dixon's earlier leveraged buyout attempt for Qantas in 2007 with Macquarie and Allco — a proposed $11 billion bid backed by about $10 billion in debt pitched at $5.45 a share. That deal fell through at the last minute but is used in the piece to illustrate Dixon's history of aggressive corporate manoeuvres and their potential implications for shareholders.
The article mentions accounting concerns at Qantas — what was highlighted and why might investors care?
The author references a past story suggesting roughly 20% of Qantas's bottom-line profit was actually capitalised expenses on software and similar items. Investors care because how costs and profits are capitalised affects reported earnings and transparency, which in turn can influence investment decisions.
How did Alan Joyce previously use a 'thermonuclear option' and why is that relevant now?
The article notes Joyce has used extreme tactics before — notably grounding the airline during a dispute with unions — and it was effective in forcing outcomes. The withdrawal of Tourism Australia funding is described as another 'thermonuclear' move aimed at countering agitators, showing management is willing to use high-stakes measures in corporate fights.
What practical steps should everyday investors take in light of this Qantas boardroom conflict?
Investors should monitor developments closely: watch for changes in board composition, public announcements from Qantas and major shareholders, any proxy campaigns, and shifts in institutional investor support. Also keep an eye on underlying financial disclosures (like capitalisation policies) and market reaction, since activist campaigns can increase short-term volatility even if long-term outcomes are uncertain.
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