RICH PICKINGS: Stimulating wealth

While the wealth of many local entrepreneurs is eroding at a fightening pace, the Rudd government's $42 billion stimulus package could reverse the fortunes of some. Here is a list of the wealthy business leaders set to win big.

The Rudd government hopes its $42 billion stimulus package will provide a big boost to the business sector as consumers start spending again and infrastructure projects kick-start economic activity.

Exactly how widespread the effects of the stimulus package are remains to be seen, but there are at least a few entrepreneurs walking around with smiles on their faces. And after watching about 30 per cent of about their wealth disappear in the last 12 months, they could certainly do with a bit of cheering up.

Here is a list of the big winners, but please note that all estimates of wealth are approximate – this is not the easiest time to estimate the rapidly-falling value of private assets.

David Barro
Sector: Building materials
Wealth: $450 million

David Barro is the owner of building materials group Barro Group, which has interests in concrete, quarries, roof tiles, civil engineering and construction. The company also owns a large stake in listed concrete producer Adelaide Brighton. Demand for all of the Barro Group’s products should be boosted by the stimulus package and Adelaide Brighton should also get a kick along – just as well, given the value of Barro’s Adelaide Brighton stake has fallen by about $200 million in the last 12 months to around $203 million.

Len Buckeridge
Sector: Building Materials
Wealth: $1.55 billion

Perth-based billionaire Len Buckeridge has ridden the West Australian construction boom for the last five years, but with the Perth housing market sliding, the stimulus is coming at great time. His empire, called Buckeridge Group of Companies, flogs everything from bricks and fibre cement through to insulation and plasterboard.

Greg Hargrave
Sector: Construction services
Wealth: $160 million

Greg Hargrave is the chief executive of labour hire company Skilled Group, which was started by his father Frank Hargrave in 1964. The company supplies tradesman and workers to the construction and property sectors, so should be well placed to cash in on extra activity in these industries. The Skilled share price has shrunk from about $5 to around $1 in the last 12 months, so any help will be gratefully received by the Hargrave family.

Solomon Lew
Sector: Retail
Wealth: $1 billion

Last year’s acquisition of clothing retailer Just Group by Solomon Lew’s Premier Investments has given the veteran investor exposure to the retail sector at just the wrong time. But companies at the 'value' end of the retail chain (that’s code for 'cheap' in retail circles) have been doing relatively well in the downturn and Just should continue to snare a fair chunk of any stimulus-inspired spending.

Bruce Mathieson
Sector: Gaming
Wealth: $1.1 billion

Bruce Mathieson is known as Australia’s poker machine king, thanks to his long-term investments in hotels and gaming venues. Research showed spending on gaming surged after the government’s $10.4 billion handouts package in December 2008 and there’s little doubt this new package will help boost entertainment spending again.

Millner family
Sector: Building materials
Wealth: $450 million

The Millner family’s main investments are stakes in pharmacy operator and investment company Washington H. Soul Pattinson and brick maker Brickworks (the two companies famously hold cross shareholdings in each other to prevent a takeover). The latter company should do well out of the stimulus plan as activity picks up in the construction sector.

Mick Power
Sector: Construction
Wealth: $400 million

Mick Power isn’t exactly a household name, but there’s no doubt he’s smiling about the Rudd government’s largesse. Power is the owner of BMD Group, which is one of Queensland’s largest construction companies. BMD, which works across the residential and heavy construction sectors, is perfectly placed to cash in on the increases in government spending on housing and infrastructure projects.

John Symond
Sector: Financial services
Wealth: $450 million

Aussie John Symond is working hard to make the most of the shake-out in the financial services sector caused by the global credit crisis. Last year he shored up his funding situation by selling a share in Aussie Home Loans to Commonwealth Bank and then swooped on the carcass of Wizard Home Loans, instantly boosting market share. The stimulus package – and the five consecutive interest rate cuts the Reserve Bank has rattled off – should provide a bit of a spark to the struggling housing market, particularly amongst first home buyers. Symond, as usual, is in a good position to benefit.

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