Top man does dash for cash

IT'S important in these times of market uncertainty to have realistic expectations. Particularly if you're running a company that's on life support.

Take David Clarke at Allco Finance.

Clarke signed up to the gig in April last year, when the world was a somewhat debt-friendlier place.

As part of his package, Clarke scored a long-term incentive package that included $3.5 million in rights or options for the 2008-09 year.

He stood to end up with about 7 per cent of the company via 25 million options.

Sadly, the world has changed a touch. And at Allco these days, everything is relative. Long-term may as well be next Thursday.

So it perhaps comes as not too much of a surprise that Clarke has chosen to "enforce his rights" to revise his contract.

Now, for some reason, Clarke would appear to prefer something other than lots of shares in Allco.

See, it's all about aligning shareholder interests with giving him the right level of incentive.

So under the new plan, Clarke will receive a far more modest 5 million options.

And the remainder? Clarke will receive the difference in cash, up to a maximum of $3.5 million.

Now that's long-term thinking.

BHP will save 'em

It's good to see BHP's chairman, Don Argus, doing his bit to help bail out investment banks around the world with his takeover of Rio Tinto.

Buried in Don't Argue Don's US bidder's statement are a few financials about how much the whole thing might cost.

And Don's charitable work in divvying up a magnificent $US4.4 billion ($6 billion) to the syndicate of banks is bound to keep a few of the slightly troubled balance sheets in business a little longer.

After all, the fees alone are about as much as a big four bank in Australia earns per year.

BHP blithely noted it has the spare cash to pay the fees.

On the BHP side, Goldman Sachs JBWere, Gresham, Merrill Lynch, UBS, HSBC, Citigroup, BNP Paribas and Lazard will divvy up a few beans. On the Rio side, there's Morgan Stanley, Macquarie, Credit Suisse, Deutsche Bank, ABN Amro, N&M Rothschild, JP Morgan and Societe Generale.

Bankers, lawyers, accountants and photocopiers will split $US3.6 billion, with the remaining $US800 million related to a $US55 billion debt facility to help finance the deal. Something for bankers to smile about as their profession is vilified around the world.

Still, it doesn't come close to the US Government's $US700 billion bail-out.

Plenty of opportunity to offer some expertise on advisory, asset origination fees, not to mention clip tickets.

And who's going to oversee setting right the excesses of the young bucks on Wall Street? A Goldman Sachs "veteran", Neel Kashkari, aged 35, according to Bloomberg.

No doubt, at that age he brings oodles of experience from the dramas of, say, 1987.

A former friend

When it comes to BHP Billiton's advances, Rio has been nothing if not consistent.

It seems Rio's chairman, Paul Skinner, had personally rebuffed approaches from his BHP counterpart, Don Argus, a few times before the takeover deal was made public.

Argus has had the deal in his sights for more than two years - since September 2006 - but he did not decide to turn it into a hostile bid until after he had met Skinner, then-Rio chief executive Leigh Clifford and the incoming Rio chief executive, Tom Albanese, over dinner in Australia in April last year.

At the dinner - which was attended by then-BHP chief executive Chip Goodyear but not by his soon-to-be replacement, Marius Kloppers, Rio indicated it "had no interest in pursuing a negotiated transaction".

Two months later Argus got Kloppers to start prepping an internal team to go hostile on Rio and, by July, BHP had hired external advisers.

BHP gave a friendly deal one last attempt in November, but Rio again rebuffed the advance.

The companies and their advisers have not had any "substantive communications" since.

Jaw pers

Surprise Aussie centuries through the ages:

Glenn Stevens, 100 basis points, October 7, 2008. Jason Gillespie, 201 not out, v Bangladesh, Chittagong, April 2006. Australia 142 beat Namibia 0, Rugby World Cup, October 2005. Oh, so close. Ian Baker-Finch, 92, first round of the 1997 British Golf Open. Oh, so close. Macquarie Group share price, $98.64, May 2007.

Building a bigger nest

With sharemarkets taking a bit of a tumble of late, there are plenty of retirees worried about their nest eggs.

So it's good to see that Dieter Adamsas is keeping his head afloat as a self-funded retiree.

The former Leighton numbers man walked away last year with a $10 million payout and still sits on the board, picking up $370,000 as a non-executive director.

But with markets down, a man still has to eat.

Dieter has also picked up $1.8 million this year for "other services", in common parlance, as a consultant.

Meanwhile, Dieter's former boss, Wal King, had to make do with a mere 18 per cent pay rise. Wal had to find room in the spare cement mixer for his $16.5 million pay packet after last year's $13.8 million and 2005's spectacular $50-odd million early retirement payout.

Enough for a guy to go pig shooting early.

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