THE DISTILLERY: Gregg's Qantas cameo

Scribes pounce on Peter Gregg for his involvement in the Qantas stoush, amid concerns about over-sharing at Billabong.

Two of Australia’s business commentators have focused on the involvement of Leighton chief financial officer Peter Gregg, a former Qantas executive, in the apparent movements by senior business figures against the airline’s strategy under Alan Joyce. It’s a thorny issue given the recent troubles with Leighton Holdings.

Fairfax’s Adele Ferguson says former Qantas executive Peter Gregg is denying that he’s supporting a plan by a group of wealthy, connected Australian businessman to buy a stake in Qantas, secure a board seat and change its strategic direction. But he has not denied giving his opinion to Qantas investors when asked for it.

"The news came as well-placed sources said the group, known as Global Aviation Asset Management, which has investors including Gregg, Geoff Dixon, the Lieberman family and John Singleton, was getting close to making a decision on whether to make a move on Qantas. Wearing his other hat at Leighton, Gregg will undoubtedly be watching with interest the implications of the latest twist in the Hotchtief/ACS Actividades de Construccion y Servicios saga. The latest development at the German-based Hochtief can only be described as a coup and the only logical conclusion is that Spain's ACS will next turn its attention to the Leighton board and any executives and directors who aligned themselves too closely with the Germans.”

The Australian Financial Review’s Matthew Stevens similarly has his attention on Gregg’s role at Leighton, suggesting that he mightn’t be too impressed with the finance director’s extracurricular activities given the problems at the construction giant.

"But that is a matter for Leighton and its board. For Qantas, the issue here is the timing of this effort at redirection rather than its population. At a moment of peak sensitivity to the progress of his strategy to drive Qantas’s international business back to a point of financial viability, Joyce finds himself challenged by a group of Qantas veterans who say they represent a cohort of shareholders that think their ambitions for a short-term recovery in the market value of the airline would be better served by alternatives other than those offered by existing management. According to one well-placed insider, the Gregg plan (for want of a better name) is not sustained by the sort of break-up plans that sat at the heart of the failed 2006 bid to fly Qantas into private hands. The plan would be to keep the whole business largely together while at the same time monetising some of the currently latent value.”

Business Spectator’s Stephen Bartholomeusz says the decision by Qantas to launch a $100 million buyback last week could in part be a recognition that the company is looking vulnerable and some share price appreciation is needed.

"With its shares trading at levels roughly half the book value of its assets and three potential magnets for private equity – Qantas domestic, its frequent flyer program and Jetstar – Alan Joyce and his board would be derelict in their duty to shareholders, and the airline, not to take the threat seriously. It was instructive that last week Emirates’ Tim Clark strongly endorsed Joyce’s strategy for turning around Qantas’ international business (which has as a centrepiece an alliance with Emirates) while taking a not-so-thinly-veiled shot at the former Qantas management supposedly at the centre of the plot to storm Qantas for the legacies they’d left.”

Fairfax’s Elizabeth Knight also looks at a not-so-certain takeover play – Billabong International. Knight points out the defining factor as to why this news has been broken to the market is the involvement of executive director Paul Naude.

"Had it not been for the fact that Naude was involved this sketchy deal would not have (and should not have) been heralded to the market. This is the kind of behind the scenes playing that often goes on but never sees the light of day. Its disclosure is testament to governance principals rather than common sense. Under normal circumstances a public announcement about this situation would be very premature. And arguably the market is now very poorly informed.”

Sticking with company news, Fairfax’s Michael West takes us into the lawsuit levelled at Newcrest Mining concerning the licence it picked up courtesy of New South Wales powerbroker and former politician Eddie Obeid.

Fairfax’s Michael Pascoe says it takes a 10 minute conversation with someone who knows what they’re talking about when it comes to online retail to discover that the strategies by Myer and David Jones are completely bogus.

The Australian’s John Durie argues that ASX chief Elmer Funke Kupper (who has the coolest name in Australian business from this column’s perspective) appears to be promoting his own self interest as synonymous with that of Australian financial markets. The two do not always converge.

Elsewhere, The Australian Financial Review’s Chanticleer columnist Tony Boyd says the concession from PwC partner Stephen Cougle that he would take responsibility for the Centro accounts of 2007 makes him a significant scalp for the Australian Securities and Investments Commission and its chief Greg Medcraft.

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