Qantas, The Board, Record Profit and Private Equity

[Prong Wallop]

Well Gentlemen, I haven't been following the threads lately so perhaps I have missed an earlier discussion on the tiltled points. How interesting it is indeed to recall that the Qantas board, who it must be remembered were going to be rewarded with a multi tens of millions dollars windfall should the deal be completed, were labelling recalcitrant investors as foolish and mad for not selling to the APA consortium.
Fast forward to the recent record, before and after tax, profit announcement made by Qantas management. The implications for insider knowledge are enormous. Had the profit been known at the time of the bid the implications for upside on the shareprice are obvious, as were the implications for a huge dividend payout and increased cash flows for the successfull bidder. Basically a huge windfall for the consortium and a huge loss of capital and income for the shareholders.
Can anyone convince me that the board had no idea of the ensuing record profit? If not they are negligent and don't know what is going on inside their own company. If so the shareholders were not informed of all the facts and the directors were not working in their interests.
Perhaps the toothless tiger called ASIC should be having a closer look at this one, but I'm not hopefull, you wouldn't want to upset the vested interests at the big end of town now would you.

[prunezeuss]

If we ran a small listed business and we tried the same stunt,ASIC would have been all over us like a loose shirt.
But because it is Qantas and its a very large morsel to chew they(Dixon and Co.)have been left alone.
Their offering was Whacko Jacko's scalp.
Someone should be headed for prison but, like Australia,Qantas is Animal Farm.
Its a disgrace.
Its downright arrogant.
Alas and alack no one will be prosecuted.
Kharma will take care of Dixon...it wont be pretty

[thepointyendboy]

The Board was to receive nothing if the bid went ahead. It was management who were to reap the gains. It was the Board (minus executive directors Dixon & Gregg) who accepted the bid. Get your facts straight mate.

[Prong Wallop]

Last time I checked Jackson and Dixon were board members, the former being Chairperson the latter CEO. Perhaps you are asserting that executive management had not provided the board with accurate internal financial reports and therefore the board was ignorant of any ensuing record profits?
A defense of ignorance?
You can't have it both ways, either the board new or it didn't, either way there are questions that should be answered regarding both the recommendation and behaviour of some of the executive directors.

[Going Boeing]

Prong, Pointy is correct. The Board (except for Dixon & Gregg) were not going to get a cent. It was to be the senior management who were to share 1% of the privatised company ie about $110million of which approx $60million was to be Dixon's payout. I firmly believe that he approached Macquarie Bank with the idea and then left it to them to stitch the whole thing together. Mac Bank was to get over $300million in fees plus their share of all the money that APA was going to rip out of the company. The whole deal was corrupt and should be investigated by ASIC.

FOG

[Capt Kremin]

GB, senior management were going to share in 4.5% of the company with 1% going to Dixon alone. This was probably why he was going to magnanimously donate his 60 million in performance pay to charity, so as to get tax credits for the 170 million he was going to recieve when he cashed out his share of something he didn't originally own.

Dixon was going to receive in excess of 200 Million in that deal, for doing nothing more than he is doing now. If that ain't theft, I don't know what is.

FOG

[Prong Wallop]

Ok the non-executive directors were not directly to receive a payout however the executive directors were most certainly going to receive a significant amount.
My point however is that whichever way you look at this situation the board was remiss in its' duty to shareholders, full stop.
The share price was proved undervalued on the information even available at the time, notwithstanding the internal reporting which must have (unless it is so inaccurate it is worthless) indicated to the board the impending record profits.
How is it the board made a misleading recommendation?
How is it that information the board of the company apparently was not privy to, made the company such an attractive leveraged buy out target?
Think of the alternative outcome. Private equity wins the bid, the company is delisted, no requirement to lodge publicly accessible financial reports, and the record profit ergo increased valuations and cash flows dissappear into private hands. Even if APA hadn't achieved enough acceptances to delist, their control of the board would have enabled them to distribute income and revalue the company on the subsequent facts.
I smell a rat, what would have been a big red dead rat.

[RedTBar]

thepointyendboy posted,

The Board was to receive nothing if the bid went ahead. It was management who were to reap the gains. It was the Board (minus executive directors Dixon & Gregg) who accepted the bid. Get your facts straight mate.

So apart from the senior management do you approve of the amount that the CEO was going to get?

[max autobrakes]

I wonder if any board members had shares in Macquarie bank?
If so, I wonder if it would be worthwhile checking the share registry to see if any large parcels of Macquarie shares were sold prior to this APA deal turning sour.
I wonder what ,if any, names/ holding companies might surface.:eek:

[max autobrakes]

Oh yeah I forgot
FOG

[RedTBar]

I wonder how many shares the board members had at the time of the takeover bid announcement.

Were they given any share packages prior to the takeover bid going public?

[Keg]

RedT, pointing out that those members of the board who made the decision on this bid were to receive nothing (apart from $5.45 for the shares they sold) and a point of view on whether the executive management deserved 5% for their efforts are two completely separate issues.

Had I been around at 1500hrs this arvo I would have pointed out the same thing- whilst also agreeing that the executive inducements in this deal were abhorrent.

[stooge]

Some simple questions - what is the share price today? And that is with the profit known, next years guidance out there and every other bit of info detailed (tiger, V Int etc) - and now what was the offer price ? And what was the share price 12 months ago?

[Sunfish]

While some people, including myself, have failed to understand the rationale behind the bid, and said so publicly (Pprune is public), it is getting dangerously close to defamation to posit that this was an inside job.

Prong's post is a bit blunt in my opinion. Please note that if legal paperwork relating to statements made here, appears at Pprune's front door, you are all going to be "outed".

P.S. You should also be aware that personal gains come in many forms, not just direct monetary gains, and the fact that the Board was not going to gain directly financially is neither here nor there, although they are entitled to the presumption that they have acted perfectly correctly.

Translation: Cool it please, and pray that ASIC will inspect this stinking mess.


Moderators: Do we need this thread? If ASIC investigates , well and good. If it doesn't, how are threads like this going to help?

[Capt Kremin]

They will never want this tested in court..... not in a million years

[Shot Nancy]

Ah, so Sunfish is really GD.

[Sunfish]

Nope, Sunfish is just a realist.

You want your name in print? You want to be blacklisted? Just make some defamatory comments and see what happens.

If you are skeptical, as I certainly am, then ask questions that require compelling answers, like why did the Board recommend the offer?

If you simply jump to conclusions you are asking for trouble of the legal kind, and since pprune is now on the Qantas radar, you are heading into danger.

( finds tin hat, digs hole in sandy patch of sea bottom and crawls in)

[RedTBar]

Sunfish,
Whilst I have asked whether someone agrees with the amount of money that the CEO was going to recieve I have not suggested any impropriety by anyone.I simply asked questions without inferring any criminal act.
As a shareholder I think I am entitled to discuss these events.That is the beauty of free speech in our country.
By the way what makes you think that pprune is on QF's radar?

[aircraft]

Prong Wallop said:
My point however is that whichever way you look at this situation the board was remiss in its' duty to shareholders, full stop.
How were they remiss? They saw an opportunity to deliver profits to many, if not most, of the shareholders.

Sunfish:
If you are skeptical, as I certainly am, then ask questions that require compelling answers, like why did the Board recommend the offer?You call that compelling? The answer to that is in the category of the bleeding obvious. See above for that answer.

Capt Kremin:
Dixon was going to receive in excess of 200 Million in that deal, for doing nothing more than he is doing now. If that ain't theft, I don't know what is.How was it theft? Who was being stolen from? Certainly not the Qantas shareholders. The shareholders of the Mac bank or other financial institutions? I very much doubt they would have considered it theft.

As for the share price at the time of the bid (which had averaged $3.60 in the 12 months prior, but had edged up to a little over $4.00 on the day of the bid, quite possibly due to the associated speculation), it is only with hindsight that you can say it was undervalued.

To have recognised at the time that it was undervalued required the insight that seemingly only APA possessed. How many of you were, at the time, madly buying shares because you knew Qantas was really worth upwards of $5.00 ?

As for this "FOG" campaign, I really think you should drop it - it makes you look quite juvenile.

[Sunfish]

Aircraft:

To have recognised at the time that it was undervalued required the insight that seemingly only APA possessed. How many of you were, at the time, madly buying shares because you knew Qantas was really worth upwards of $5.00 ?

Yes, Aircraft, that is exactly the question that we, and the market are still asking. Exactly how did APA come to the realisation that Qantas was undervalued?

I think the answer to that question would be extremely interesting, because, in my humble opinion and the opinion, it appears, of professional investors, such a conclusion could not be supported on the basis of the publicly available information provided by the Board and Senior management of the company to its investors at the time.

So how did this bid come about, Aircraft?

[Sunfish]

Nah! No contest, and I shouldn't feed the trolls. My bet is that Aircraft has no answer.

[Fliegenmong]

:} :E - I'm pulling up a chair...................

[Mud Skipper]

Sorry,

Aircraft had to go to school and won't be home till after 3:30 :}

[lowerlobe]

I'm envious of aircraft because it must be a comfort to be able to ignore the obvious and live in your own little world.

[Capt Kremin]

I lost a bet here. I had 20 bucks saying that aircrafts first response in rebuttal of Sunfish would be, "But Dad......!!":E

[aircraft]

Sunfish said:
Exactly how did APA come to the realisation that Qantas was undervalued?

So how did this bid come about, Aircraft?
Err, this is the sort of thing they do. Mac Bank have whole floors full of people on 6 digit salaries whose job it is to seek out these opportunities and make these assessments.

Not a cheap process of course, but you could engage them yourself to make such assessments/valuations.

I very much doubt that Dixon would have approached Mac Bank. It is not his job to do that and I cannot see why he would have wanted to.

As for Dixon "knowing that" Qantas were undervalued - well of course he would be of that opinion. He is probably still of that opinion. Can you think of a CEO that would (publicly) say their company wasn't undervalued?

[Sunfish]

In answer to my question:

Exactly how did APA come to the realisation that Qantas was undervalued?

Aircraft wrote:

Err, this is the sort of thing they do. Mac Bank have whole floors full of people on 6 digit salaries whose job it is to seek out these opportunities and make these assessments.

Not a cheap process of course, but you could engage them yourself to make such assessments/valuations.


Sorry Darling, but you have conveniently forgotten that major investment Banks and hedge and superannuation funds also have "whole floors full of people on 6 digit salaries whose job it is to seek out these opportunities and make these assessments".

............And the major Qantas investors conclusion prior to the bid, produced by their own six figured salary wunderkinds, from the information provided publicly by the Board and Senior Management, as it was duty bound to provide, was that the company was worth well South of $4.00.

And when they made these assessments, the Board of Qantas did not contradict them

And furthermore, having dealt in some $60 million worth of highly complicated investment transactions with Macca's, I can assure you that their skills lie in considerably different areas than reading the entrails of annual reports and divining hidden messages that are opaque to the general investment community, and I have the scars to prove it. So please don't try and attribute them with superhuman powers of analysis.

So my question stands:

Exactly how did APA come to the realisation that Qantas was undervalued?

P.S. The Board of a public company, and their employee, the CEO, have a statutory duty of continuous disclosure of information to investors so that said investors can form their own appreciation of the value, and future value, of their investments.

This involves both "talking up" (the usual message) and on occasion "Talking down" the value of the business as new information comes to hand.
While I am sure that the Board of Qantas, lawyered to the hilt, complied with the letter of the law, events before, during and after the bid appear to show that there has been a certain shall we say "information asymmetry" in that existing investors, in an effort to make their own estimate of the value of their shares, had to pry information out of the Board with a crowbar during the bid.

Better analysts than me have publicly commented on the events surrounding the bid for Qantas. However I am sure, given the number of lawyers involved, that everything was perfectly legal, the laws complied with, and the apparent asymetry explainable by unusual circumstances beyone my (and everybody else's) ken.

And a P.P.S.

Not a cheap process of course, but you could engage them yourself to make such assessments/valuations.

Aircraft, don't be naive. If you are silly enough to engage any Merchant Bank to scope an undervalued investment opportunity for you, and the analysis comes up trumps, they will beat you to the punch and buy it themselves or get their friends to buy it. Seen it done.

...And remember when you invite them in to look at a purchase of one of your competitors, they are automatically sizing up the opportunity to sell you to that competitor instead. Happened to me once.

[QFinsider]

From Sydney Morning Herald March 2007

"THE idea that Qantas chief executive Geoff Dixon has suddenly discovered all these excellent new ideas for running Qantas after talking to Macquarie bankers, Bob Mansfield, David Coe and the others behind Airline Partners Australia, which the company may be putting about, is, to say the least, unbelievable.

It was, of course, the other way around. Dixon's existing strategy became APA's - except, perhaps, for the new wheeze of borrowing some money and giving it to shareholders (claps hand on forehead - "Borrowing to replace equity - brilliant!").
Shareholders might like to ask Dixon and the rest of the board why they're only now putting on a happy face and spruiking an upbeat vision of Qantas's future, instead of all the glum warnings about business risks, and impending share price collapse, with which they have been trying to frighten shareholders into the arms of APA for the past five months.

Why not do it last year before the offer, to head it off? Why not publicly talk up the company's prospects after the bid was announced? And why not put this week's presentation in the target statement? Thank goodness, small shareholders will now be saying, Andrew Sisson of Balanced Equity and Paul Fiani of UBS had their own view of the company's prospects - now vindicated.
On Friday morning, after listening to Dixon's investor presentation on Thursday, Macquarie Equities aviation analyst Andrew Wilkinson upgraded his 12-month price target for Qantas to $7.05 - $1.60 more than the offer price.

So on the basis of its own analyst's numbers, Macquarie and its partners were trying to steal Qantas from its shareholders for $3.1 billion - 20 per cent - less than it is worth.
This shows several things: how clever they were to have seen that opportunity; how stupid they were to declare the bid "final" at the start (they could have easily got Qantas for $6 a share, which is still $2 billion less than the company is worth) and how mistaken the board was to support them and keep supporting them.

This week's presentation contained little that was new - but what was really new was the tone. As the headline on the Macquarie Bank research report said: "Glass finally half full."
Exactly. During the offer Dixon and the board were gloomy gutses, trying to justify their support for it and get shareholders to sell. Their sudden conversion to optimism now that the bid has failed does them no credit at all.
Macquarie's new $7.05 a share valuation on Qantas is simply based on a comparison of its valuation with two other airlines, Singapore Airlines and Cathay. They sell for 5.5 times enterprise value while Qantas is selling at 4.5 times EV.

Qantas has sold at more than 5.5 times EV in the past and, Wilkinson says, it probably will do so in future as airlines continue to be rerated.
The biggest threat to the company's value, apart from the unpredictable prospect of terrorism and oil shocks, is the entirely predictable entry of the Singapore Airlines-controlled Tiger Airways into the Australian market.
This week Melbourne Airport agreed to let Tiger use terminal four, which was Virgin Blue's first terminal in Melbourne before Ansett went broke and it was able to move into the deceased estate known as terminal three.
A Sydney Airport spokesman told me yesterday that it was talking to Tiger about Sydney's common user terminal - number 2 - which would be shared with Virgin Blue and Jetstar.

More important for Tiger is an air operator's certificate; the process for getting that is under way with the Civil Aviation Safety Authority. The regulator has made an estimate of the cost of the "job" (at $160 an hour), and Tiger is about to cough up a 50 per cent deposit, imposed to discourage fly-by-nighters. A CASA spokesman said
yesterday it should take three to six months to issue the certificate, including inspections of facilities, after which Tiger will be free to fly passengers around Australia.

So by September or October there will be an airline price war, possibly like nothing we have ever seen before.
Dixon jammed his flag in the ground on Thursday when he said Qantas would do whatever was necessary to defend 65 per cent total market share. At the moment, according to Dixon, Qantas has 51.9 per cent and Jetstar 15 per cent - a total of 66.9 per cent.
How much will this price war knock off Qantas's bottom line? Well, Tiger plans to launch in Australia with five planes, and hopes eventually to grow that to 30. The initial five will increase the capacity on the routes involved by 3 per cent. Adding the planned growth by Qantas and Virgin Blue, that will lift total domestic capacity by 12 per cent, which compares with the long-term average growth of less than 5 per cent.

That should lead to lower yields and profits, especially if a new cut-price airline is trying to gain initial market share. But some believe (hope?) the extra capacity could produce weaker loads (more empty seats) instead.
But at this stage local institutions are buying Dixon's new upbeat story and, so far at least, are happily soaking up the stock that hedge funds are selling, which they had bought from the people they are now selling to.
Qantas's chairman, Margaret Jackson, thought the hedge funds would be squeezed by the locals as they crammed the exits, and would have to take losses of up as much as $1 a share. But she wasn't counting on the new, upbeat Geoff Dixon, and the fact that Qantas's prospects actually do look pretty good."

Alan Kohler publishes Eureka Report, an investment newsletter financially backed by Carnegie Wylie & Co, an adviser to Qantas. The views expressed here are Kohler's alone.
Have a read of that, we aren't the only ones who believe there is more to this deal than meets the eye, ASIC should be looking closely at the transaction

[RedTBar]

It does not matter what examples we give aircraft he still will not change his view.He cannot understand or accept any analogy you give him and will not admit any mistake.

Any corporate group cannot do anything wrong in his view and examples of criminal neglect from some will just be ignored.Therefore any attempt to engage him is futile and frankly a waste of time.When he started here and was boasting about Dixons child J* he did not even know that J* Asia existed.

Perhaps he should get a job at Mc Donalds like a lot of other school kids and find out about the real world.

[aircraft]

Sunfish:
Sorry Darling, but you have conveniently forgotten that major investment Banks and hedge and superannuation funds also have "whole floors full of people on 6 digit salaries whose job it is to seek out these opportunities and make these assessments".
Yes, but they don't look as closely at their investment targets. They could if they wanted to, of course, but the nature of the examination of Qantas by Mac Bank was, and had to be, far more extensive. By the time the bid was announced, the assessment had probably cost Mac Bank well over a million dollars.

............And the major Qantas investors conclusion prior to the bid, produced by their own six figured salary wunderkinds, from the information provided publicly by the Board and Senior Management, as it was duty bound to provide, was that the company was worth well South of $4.00.
This is a particularly long winded way of saying the share price was less than $4.00! Yes, the market had Qantas at around $3.60 six months prior to the bid announcement - but as I said above, the market valuation will not be as good as one that costs a million dollars!

[surfside6]

Hey Aircraft,
I have a bridge for sale....are you interested?
Its grey,shaped like a coathanger..not too old.
McQ bank has crunched the numbers.
PM me if you want to commence due diligence.
Shhhh!..we will keep the profit forecasts to ourselves
If you pay me a 60mil I can convince the board its a great deal.

[Keg]

AIRCRAFT IS A TROLL.

His only 'thing' on this forum is to post inane comments to wind people up and diverting them into long winded responses. :suspect:

[aircraft]

RedTBar said (about me):
Any corporate group cannot do anything wrong in his view and examples of criminal neglect from some will just be ignored.
Corporate groups can do wrong, in my view, but be aware that I quite likely have a different idea of "wrong" (in the corporate context) than most of you.

Where is this "criminal neglect"? I genuinely cannot see where anything in the process could be considered criminal (other than some insider trading as word about the pending bid leaked out - but I believe that that almost always happens in these situations and is next to impossible for ASIC to do anything about). As no investigations have been launched by ASIC, it appears they feel the same way.

QFinsider,
I have read that Kohler piece before - there is nothing in it to get excited about. My comments on certain passages:

Shareholders might like to ask Dixon and the rest of the board why they're only now putting on a happy face and spruiking an upbeat vision of Qantas's future, instead of all the glum warnings about business risks, and impending share price collapse, with which they have been trying to frighten shareholders into the arms of APA for the past five months.
The "happy face" was due to the new found value of Qantas - it was vindication for Dixon and the board. It showed they had been right all along! The "impending share price collapse" scenario originated with market analysts outside Qantas. Statements to that effect by people such as Jackson were just rebroadcasts of the those made by the analysts.

So on the basis of its own analyst's numbers, Macquarie and its partners were trying to steal Qantas from its shareholders for $3.1 billion - 20 per cent - less than it is worth.Using the word "steal" here is just sensationalist journalism. If you bought a house for less than you believed it was worth, would you say you "stole" it?

[surfside6]

What about the bridge...you fool...what about the bridge?

[Gen. Anaesthetic]

What about ethics aircraft? Where do ethics fit into your deliberations, or is it purely a matter of working the system to its limit? I ask that genuinely, not trying to get a rise, but it's a question that is not asked enough these days IMHO. From what I am seeing your line would be along the lines of "corporations do whatever they have to do within the legal limits in order to survive and maximise return to shareholders". Fair enough, but the law cannot cover all contingencies and when the human and other less tangible costs are considered, is such behaviour justified?

FYI I come from both a pilot's background as well as a corporate one, having worked in the corporate world since deciding to jump the fence back in the 90's. So I am watching with interest the different perspectives on all this. It does strike me though, that the aviation industry, compared to others that I have worked in, is as self destructive in its lack of ethical - or for want of a better term systemically healthy - behaviour as any I have seen. Actually it goes beyond ethics; it really is more of a long term sustainability issue. Some might say that this is due to the highly competitive nature of aviation, but I would suggest it is more of a lack of leadership that has lead the industry into this short-term behaviour.

Indeed in many other industries we are seeing greater focus on effective corporate governance and from what I can see Qantas fails in this department badly. And by effective corporate governance I'm talking about boards not just focusing on the bottom line (i.e. financial metrics) but others, like social impact. Certainly their annual report mentions their efforts in charity work, but this is a far cry from being socially responsible, and if some of the accusations running on this thread are true, then it's not altogether surprising.

I find the attitudes of many management types in aviation to be quite astounding, stuck about 20 years behind the types of environments I have been fortunate to experience. Which reminds me aircraft, when you talk about taking a sample of managers, you need to be considering managers from industries outside of aviation as well as inside, then your bell curve example - which is dodgy to say the least (not the bell curve necessarily - although there's usually a fair bit of fudge going on with those - but the assumptions) - might stack up, even though the results might not be what you were after.

All comments made here with constructive intent, no siht stirring intended.

[Sunfish]

Aircraft:

Where is this "criminal neglect"? I genuinely cannot see where anything in the process could be considered criminal (other than some insider trading as word about the pending bid leaked out - but I believe that that almost always happens in these situations and is next to impossible for ASIC to do anything about). As no investigations have been launched by ASIC, it appears they feel the same way.

Taking the last point first, there is no way any one us would know if ASIC has launched an investigation or not.

As for your assertion that ASIC cannot detect, let alone prosecute, insider trading, try it mate, and see. For your reference, all trades are logged and all phone calls to brokers are recorded, and ASIC can and does look at suspicious trades in the lead up to corporate announcements as a certain gentleman who one worked for Macca's found out the hard way.

As for the Qantas Board doing anything "criminal", that would be a matter for the authorities.

Using the word "steal" here is just sensationalist journalism. If you bought a house for less than you believed it was worth, would you say you "stole" it?

No Aircraft, you wouldn't say you stole it, however the original owner might if he had been advised by a person who owed him a fiduciary duty, to sell it to you at a low price that could be proven to be under market value.
The Board of Qantas has a fiduciary duty to shareholders to maximise the value of their investments to them.

Clearly the market did not agree that selling their shares at $5.40(or whatever the exact figure was) to APA was maximising that value.

Therefore either the Board was suffering from spectacularly wrong judgement or there was another reason unknown to all of us.

So my question still stands:

Exactly how did APA come to the realisation that Qantas was undervalued?

I'm concerned that some poster here is trying to make one of us say something defamatory about the Qantas Board, which is something I won't do, and niether should anyone else.

[Clipped]

Very interesting article by The Australian's Terry McCrann -

ASIC must tell the full story of what happened at QantasFont Size: Decrease Increase Print Page: Print The airline's board seems incapable of giving a satisfactory account, writes Terry McCrann | August 25, 2007
THE Qantas result makes it crystal clear and utterly undeniable. Chairman Margaret Jackson and her board were urging shareholders to sell the company $1.5 billion - at the very minimum - below value.

It's important to understand that that's below their minimum value. Not what I or others -- including obviously the two "recalcitrants" -- would have regarded as a reasonable minimum.

Further, it's not hard to make the case that Jackson and co were urging a sale at $2.5 billion or so under their own reasonable valuation.

Even more damagingly, in my judgment, they were urging a sale at least $4 billion below a conservative valuation in the context of a takeover.

Now this is not just of embarrassing historical interest. Although it does seem that CEO Geoff Dixon, who with his CFO Peter Gregg was to be a pivotal on-going management member of the takeover team, resolutely refuses to "get it".

After the profit release Dixon actually bristled at the suggestion that shareholders might have the right to be peeved. And he refused to offer any apology.

Dixon then went on to fatuously, rather desperately, point to the Qantas share price, which in the heat of the sub-prime meltdown had fallen below the $5.45 offer price.

Apart from the meltdown factor -- Qantas closed at $5.56 in yesterday's weaker market -- if Dixon does not understand that an offer price should be higher than an everyday market price he has some financial education ahead of him.

The Qantas saga goes to continuing issues absolutely critical to the integrity of the market and good corporate governance.

Arguably, in my judgment, the corporate regulator ASIC is obliged to investigate the specific circumstances of the Qantas takeover in its own right.

But also as a case study for two broad and fundamental issues. The dynamics of leveraged buy-outs where senior management is a critical component of the buying group. And then obligations on boards to keep shareholders fully informed on a timely basis.

Between mid-December when Jackson and her fellow directors (excluding Dixon and Gregg) signed off on the APA offer -- with that unfortunate embrace of Dixon -- and nearly five months later in early May when it collapsed in chaos, they gave shareholders only three profit updates.

At the release of the interim profit in early February, they said profit for the full year to end-June was anticipated to be around 30-40 per cent higher than last year.

In the sloppy way that Qantas seems to articulate these things, it did not specifically state whether that was pre-tax or post-tax.

It's actually pre-tax. So Qantas was predicting that the full-year result would come in between $872 million and $940 million. With six months already locked in.

The next profit update had to be dragged from the board. Nearly six weeks later, in mid-March, Qantas released a statement noting "substantial media commentary" and, more importantly, "questions from certain investors" (the recalcitrants) on the profit outlook.

"In response to these matters," suggesting that Qantas would not have volunteered the information, the company "confirms" -- a very strange word, confirms who or what? -- that the full-year result was likely to be "towards the upper end" of that February range.

In short, closer to $940 million, but still less than it, than towards $872 million.

Despite further continuing comment, the directors volunteered no further guidance until the dying -- both figuratively and literally -- days of the offer in mid-April.

In their first supplementary target statement, they again urged shareholders to accept. On the outlook, they said they considered "there has been no material change in the net financial position of Qantas from that referred to in the 15 March guidance announcement".

That's somewhat ambiguous but can reasonably be taken as an endorsement of the profit guidance. With the qualifications they had outlined, which on balance tended negative.

So 9 1/2 months into the year directors were predicting a pre-tax profit somewhat short of $940 million. And there was no further guidance as the clock ticked into the 11th month and down to the offer's collapse.

The profit came in at $1079 million.

That's after adjusting for the $47 million provision Qantas made for the "alleged" price fixing in the US, which had been specifically excluded from the forecasts.

In short, they were still predicting a sub-40 per cent profit increase -- indeed, all the way through not only the offer's close but the financial year's end. When it came in just over 60 per cent.

The key questions are simple and time-honoured. What did they know and when did they know it? In the context of a takeover, what should they have known?

And what did management led by Dixon know? Should have known? They took no part in the offer deliberations, but kept running the company and had to be the information conduit to the board.

The outcome as opposed to the expectation makes a huge difference to the value at which directors "thought" they were urging shareholders to sell.

They "thought" they were endorsing a bid at between 11.6 and 12.4 times the expected 2007 pre-tax result. They were in fact endorsing a bid at just 10 times the actual 2007 pre-tax profit.

To get back into that directorial recommendation range, the offer instead of being $5.45 would have had to have been between $6.32 and $6.76.

That's to say instead of urging the sale of the company at a total $10.8 billion, the minimum directors should have required was $12.4 billion.

Even $13.4 billion would have been at a modest 12.4 times actual anticipated 2007 profit. My $4 billion extra comes from ascribing a still modest 14 times multiple to the profit.

Now I have no doubt that Jackson and her fellow directors were acting in the best interests of the shareholders as they saw it.

And they expected the takeover to be wrapped up quickly. Their adviser Carnegie Wylie's Mark Carnegie told them, aggressively, that foreign investment takeover approval would not be required. He was wrong.

The problem is that as the takeover dragged on and Qantas's performance improved dramatically, the directors should have changed their minds. But Jackson in particular "did a Thatcher" -- she was not for turning. Up to a point that's fine. What was unacceptable was the failure to keep shareholders informed so they could make up their own minds.

At the very least the market is due a full accounting. Qantas is incapable of providing it. ASIC must

[Willi B]

As for the Qantas Board doing anything "criminal", that would be a matter for the authorities.

Sorry to be a pedant, but actually, it's a matter for a Court.

[lowerlobe]

Actually,if there was a criminal act carried out by any board it would be looked at by the appropriate authorities and then if there is believed to be a case it would then be put before the courts.

[Willi B]

Sorry Lobie old fruit, you haven't quite grasped the full picture.

Prosecutorial authorities may allege wrongdoing by way of laying a charge; but it's for a court to determine guilt, to the criminal standard of beyond reasonable doubt.

And an accused person (or entity) is entitled to the presumption of innocence until proven guilty by a court.

[Willi B]

I respectfully demur.

Lobie said:Actually,if there was a criminal act carried out by any board ...

He's convicted the accused without a trial - hardly a minor matter in our justice system.

Still, he's in good company: Bill Keelty's finest, the Commonweath DPP and Kevin Andrews have unsuccessfully endeavoured to do the same to Dr Haneef.

[Sunfish]

M'Lud, I recommend this thread be closed.

[lowerlobe]

Well my old fruit loop it is obvious that you are trying to twist my words to suit your own version. Your terminology is admittedly impressive …for a high school student.

Under an adversarial legal system, much like ours, the courts have no ability to hear a case, whether civil or criminal, without having the case first brought before the court by a plaintiff, or in this case, an investigating body.

The court cannot initiate a case or investigate and gather evidence unless you are in some sort of international war crime trials. Proving a case beyond reasonable doubt would be very difficult if not impossible if the case wasn’t bought before a court in the first place by the appropriate authorities.

My post was attempting to show the sequential order in a criminal case. Perhaps you come from a country whereby the legal process is inquisitorial, but even then the court cannot initiate the case.

As far as the assertion that I have convicted anyone without trial I suggest you learn to read and see the word “IF” in my post not the word “IS” ….as in "IF there was a criminal act" NOT "there IS a criminal act"

Fruit Loop posted this

“He's convicted the accused without a trial - hardly a minor matter in our justice system.

Additionally, I suggest fruit in a suit that you re-read my post and show me where I used the word “GUILTY”.

[Going Boeing]

The airline's board seems incapable of giving a satisfactory account, writes Terry McCrann | August 25.

THE Qantas result makes it crystal clear and utterly undeniable. Chairman Margaret Jackson and her board were urging shareholders to sell the company $1.5 billion - at the very minimum - below value. It's important to understand that that's below their minimum value. Not what I or others -- including obviously the two "recalcitrants" -- would have regarded as a reasonable minimum. Further, it's not hard to make the case that Jackson and co were urging a sale at $2.5 billion or so underown reasonable valuation. Even more damagingly, in my judgment, they were urging a sale at least $4 billion below a conservative valuation in the context of a takeover.

Now this is not just of embarrassing historical interest. Although it does seem that CEO Geoff Dixon, who with his CFO Peter Gregg was to be a pivotal on-going management member of the takeover team, resolutely refuses to "get it". After the profit release Dixon actually bristled at the suggestion that shareholders might have the right topeeved. And he refused to offer any apology. Dixon then went on to fatuously, rather desperately, point to the Qantas share price, which in the heat of sub-prime meltdown had fallen below the $5.45 offer price. Apart from the meltdown factor -- Qantas closed at $5.56 in yesterday's weaker market -- if Dixon does
understand that an offer price should be higher than an everyday market price he has some financial education ahead of him.

The Qantas saga goes to continuing issues absolutely critical to the integrity of the market and good corporate governance. Arguably, in my judgment, the corporate regulator ASIC is obliged to investigate the specific circumstances of the Qantas takeover in its own right. But also as a case study for two broad and fundamental issues. The dynamics of leveraged buy-outs where senior management is a critical component of the buying group. And then obligations on boards to keep shareholders fully informed on a timely basis. Between mid-December when Jackson and her fellow directors (excluding Dixon and Gregg) signed off the APA offer -- with that unfortunate embrace of Dixon -- and nearly five months later in early May whencollapsed in chaos, they gave shareholders only three profit updates. At the release of the interim profit in early February, they said profit for the full year to end-June was anticipated to be around 30-40 per cent higher than last year. In the sloppy way that Qantas seems to articulate these things, it did not specifically state whether that pre-tax or post-tax. It's actually pre-tax.

So Qantas was predicting that the full-year result would come in between $872 million and $940 million. With six months already locked in. The next profit update had to be dragged from the board. Nearly six weeks later, in mid-March, Qantas released a statement noting "substantial media commentary" and, more importantly, "questions from certain investors" (the recalcitrants) on the profit outlook. "In response to these matters," suggesting that Qantas would not have volunteered the information, the company "confirms" -- a very strange word, confirms who or what? -- that the full-year result was likely to be "towards the upper end" of that February range. In short, closer to $940 million, but still less than it, than towards $872 million.

Despite further continuing comment, the directors volunteered no further guidance until the dying -- both figuratively and literally -- days of the offer in mid-April. In their first supplementary target statement, they again urged shareholders to accept. On the outlook, they said they considered "there has been no material change in the net financial position of Qantas from that referred to in the 15 March guidance announcement". That's somewhat ambiguous but can reasonably be taken as an endorsement of the profit guidance. With the qualifications they had outlined, which on balance tended negative. So 9 1/2 months into the year directors were predicting a pre-tax profit somewhat short of $940 million. And there was no further guidance as the clock ticked into the 11th month and down to the offer's collapse. The profit came in at $1079 million. That's after adjusting for the $47 million provision Qantas made for the "alleged" price fixing in the US, which had been specifically excluded from the forecasts. In short, they were still predicting a sub-40 per cent profit increase -- indeed, all the way through not only the offer's close but the financial year's end. When it came in just over 60 per cent.

The key questions are simple and time-honoured.

What did they know and when did they know it?

In the context of a takeover, what should they have known? And what did management led by Dixon know? Should have known? They took no part in the offer deliberations, but kept running the company and had to be the information conduit to the board. The outcome as opposed to the expectation makes a huge difference to the value at which directors "thought" they were urging shareholders to sell. They "thought" they were endorsing a bid at between 11.6 and 12.4 times the expected 2007 pre-tax result. They were in fact endorsing a bid at just 10 times the actual 2007 pre-tax profit. To get back into that directorial recommendation range, the offer instead of being $5.45 would have had to have been between $6.32 and $6.76. That's to say instead of urging the sale of the company at a total $10.8 billion, the minimum directors should have required was $12.4 billion. Even $13.4 billion would have been at a modest 12.4 times actual anticipated 2007 profit. My $4 billion extra comes from ascribing a still modest 14 times multiple to the profit. Now I have no doubt that Jackson and her fellow directors were acting in the best interests of the shareholders as they saw it. And they expected the takeover to be wrapped up quickly.

Their adviser Carnegie Wylie's Mark Carnegie told them, aggressively, that foreign investment takeover approval would not be required. He was wrong. The problem is that as the takeover dragged on and Qantas's performance improved dramatically, the directors should have changed their minds. But Jackson in particular "did a Thatcher" -- she was not for turning. Up to a point that's fine. What was unacceptable was the failure to keep shareholders informed so they could make up their own minds.

At the very least the market is due a full accounting.

Qantas is incapable of providing it.

ASIC must.


I wonder if GD is starting to feel the noose tighten?

[Willi B]

Well my old fruit loop it is obvious that you are trying to twist my words to suit your own version. Your terminology is admittedly impressive …for a high school student.


Lobe, old cobber, it's always a pleasure to read your measured, well reasoned, invective free and incisive contribition to the debate.

Perhaps you come from a country whereby the legal process is inquisitorial, but even then the court cannot initiate the case.


Sorry to disapoint old son, just a poor Oz battler from the country, trying to make his way in the big smoke.

I suggest you learn to read and see the word “IF” in my post not the word “IS” ….as in "IF there was a criminal act" NOT "there IS a criminal act"
and

I suggest fruit in a suit that you re-read my post and show me where I used the word “GUILTY”.

With great respect, you misdirect yourself. It's not a question of 'if' versus 'is'. Your temporal reference is irrelevant in this context. You fell into error by using the word 'criminal' in an adjectival sense to qualify the noun 'act'. You thus implied a sense of guilt to the deed you quote that was, as you said, done on behalf of the board.

Your error can be cured by the use of the adverb 'allegedly' in front of 'criminal'.

You're getting warmer when you concede that under our adversarial legal system, it's for a court to determine guilt. May I acquaint you with the eloquence of Viscount Sankey (cited with approval by Horace Rumpole and still good law in Australia): Throughout the web of the ... criminal law, one golden thread is always to be seen - that it is the duty of the prosecution to prove ... guilt. If at the end of the case there is reasonable doubt ..., the (accused) is entitled to an acquittal Woolmington v DPP [1935] AC 462

Sunfish

M'Lud, I recommend this thread be closed.

I respectfully agree.

[lowerlobe]

Semantics .....old boy me old porridge sparrow.....Semantics

Since in most courts for the accused to be convicted they have to be found guilty.Since you cannot find any example of my using that term I understand your angst old fruit.

However,since this is not a literary lecture and since you would not last more than a day in court I understand old sparrow why then that you want this thread closed.

pip pip old boy

[aircraft]

Gen. Anaesthetic,

Corporations can justify any manner of "abhorrent" behaviour by pointing to the share price. Lay off a thousand workers just before christmas, pollute a river, bring down a democratically elected government, whatever - as far as the corporation is concerned, if it caused the share price to rise it was the correct thing to do.

Corporations are monsters that man has created in his own image. Have you seen the documentary "The Corporation"? Horror after horror laid bare, but precisely the sort of behaviour demanded (indirectly) by the shareholders.

Most shareholders don't appreciate the role they play in the behaviour of their corporation, and get all angry when they discover some of the acts that have occurred in their name, but are silent on how to achieve the profits without the atrocities.

It seems to be one of the laws of the universe that most things (the vast majority in fact) that are good for profits are bad in some way for humanity. Corporations thus are always treading a fine line between making profit and upsetting humanity. They can frequently be seen spending vast sums on goodwill projects (often environmental), but these efforts are usually purely for the PR value, but occasionally they are to remedy a little niggle on the conscience of the executive.

The documentary closed with a CEO of a manufacturing company outlining his vision for his company to eventually be able to produce the product (carpets) in such a way that the effect on the environment would be neutral.

What can be done? Unless you wish to dismantle capitalism, nothing. When a particular corporation so misbehaves as to warrant government attention, rather than pass laws, the government will usually "remind the company of it's mutual obligations", which is just a way of saying "please behave".

Thanks for the comments re the Bell curve. If I had included the managers of all industries, I don't believe the exercise would have worked - somebody would have come out with a statement to the effect that all aviation managers occupy the extreme left positions on the curve, and I would have been back at square one!

[Sunfish]

Aircraft:

Corporations are monsters that man has created in his own image. Have you seen the documentary "The Corporation"? Horror after horror laid bare, but precisely the sort of behaviour demanded (indirectly) by the shareholders.

No I haven't seen the documentary, obviously you have, and it's obviously your only window into corporate behaviour. My expereince by the way, is first hand.

Furthermore, you are dead wrong about the "behaviour demanded by shareholders" on too may levels to enumerate, but here are just a few.
What is required, Dear Aircraft, is for the Board and Senior Management to maximise the value of the company in the long term.

Short term sub optimal behaviours. like polluting rivers, price gouging, "outsourcing", etc. actually reduce the value of the company even while the managers are lining their pockets with annual bonuses - in fact that is why bonuses are so corrosive - they focus attention on short term results and of course short term thinking becomes the management habit, and of course their eventual folly or criminal behaviour is always found out - by the shareholders.

The pages of Pprune abound with examples of Qantas short term thinking, which is understandable because the very maximum time horizon of the senior players until recently was about five years - the approximate duration that APA was going to hold the company before refloating it and walking away with a bucket of money.

However I suspect that most Qantas managers can't see past their next annual bonus cheque - look at what appears to be happening with the outsourcing of heavy maintenance - great bonus for the bosses last year, but now the company is being screwed because their are few 747 heavy maintenance slots open overseas (at least thats what I'm led to believe) and all Qantas Management can look forward to is a steadily increasing maintenance bill as suppliers carefully gauge how much they can charge without making it attractive enough for Qantas to invest in the fixed costs necessary to reopen its own facility.

But of course thats next years (and some other managers) problem, I got my bonus and I'm all right jack!

Then of course your trite analysis simply ignores the role corporations play in growing markets - which requires investment instead of rapacious behaviour if your growth is to be sustainable.

But here good old Sydney-centric Qantas has failed as well, for instead of growing the market for Brisbane, Melbourne, Adelaide and Perth bound direct international flights, it has F***** us over once again, and will continue as a result to be the least favourite international airline for anyone living outside Sydney - and one day the market will make it pay a price for that.

And finally on a Corporate Governance basis, unless a Board is made up of brain dead narcissists, and given the legal responsibilities of Public company Directorships, they will run for the exits if they detected management doing anything that was illegal, unethical or potentially reduced the value of the company.

.....which makes the behaviour of the Qantas Board over the APA bid even more perplexing.

[lowerlobe]

aircraft posted....

Corporations are monsters that man has created in his own image. Have you seen the documentary "The Corporation"? Horror after horror laid bare, but precisely the sort of behaviour demanded (indirectly) by the shareholders.

Most shareholders don't appreciate the role they play in the behaviour of their corporation, and get all angry when they discover some of the acts that have occurred in their name, but are silent on how to achieve the profits without the atrocities.

aircraft you have to joking.The description you have just made with a few titles changed would have described WW2 perfectly.

Are you sure that you haven't had a dream after watching a movie on a Saturday night and got confused?

You can't be serious in defending some corporations with this analogy.

No wonder then that you have this myopic view of a corporation that will or should do anything to justify a rise in their share price.

[b55]

The point of the documentary movie " The Corporation" was to show a parallel pattern of behaviours of a psychopath and a corporation. This was done through the standard list of about 10 separate and standard behaviours of a psychopath. The movie does a pretty good job of showing these parallels between the two.
Most great concepts bring along some downside effects i.e.;
Christianity brought the Crusades, the Inquisition, burning witches, etc.
Corporations are no different in having down side effects as well.
This movie is worth seeing if you get a chance.

[lowerlobe]

After reading aircraft's post about this movie I thought I'd do a bit of research.

Here is a quote from one synopsis of the movie...

But what The Corporation fails to address with enough depth is just how much impact people really have on corporations. A corporation is, after all, only as good as the people who inhibit it. Sure, an executive has to worry about pleasing shareholders and winning bread for his family, but in the end the willingness to decrease pollution, or creating better working conditions, lies in the hands of that same executive and not some faceless entity known as the ‘corporation.’

A corporation is nothing but a legal entity. It is a shell that is run by humans, filled by human emotions and considerations. To place blame on a corporation, is to place blame on the shoulders of those human beings.

So aircrafts justification of corporate behaviour is false.So many times in history have we seen someone blame their actions on others.

"We were only following our orders"....."We are only doing what our shareholders want us to do".."We are acting within the law"

To say that a corporation has the same mindset of a psychopath is false.Certainly the corporation can act in the same way that a psychopath might but it is the person or people running the corporation that have this mindset.

For aircraft to say this is the fault of our capitalistic society is to try and shift the blame and lay it at someones else's feet.

How many times have we seen that?

aircraft go back and read what was said at the Nurnberg trials.It's always someone else's fault and using this as a sort of shifting the blame as a justification for their actions.

[Sunfish]

Corporations are legal entities. If you fill them with psychopaths, then they will behave like psychopaths.

However, part and parcel of the entire triple bottom line concept as well as enlightened Human resources practices are aimed at ensuring you do NOT hire psychopaths, having said that, its been my misfortune to have had to engage with two of them in business and they leave a trail of wreckage and destruction in their wake - thats shareholders, employees and customers.

Narcissistic personality disorder types are often highly intelligent and very hard working - except all their energies are devoted to displaying this brilliance to their superiors. They "calibrate" audiences and then manipulate their image to mirror their audiences dreams, they can be very very seductive.

By this I mean if you have a penny pinching Board, they will appear to "out scrooge" the lot of them. If the chairman prides himself on his patronage of the opera, then so does our hero - by coincidence of course.

They often produce excellent results - or so it appears to their superiors, because they are not aware of the trail of corporate casualties in their wake in the form of good people who leave after being shafted by the narcissist on the way up.

Once in the top job, they surround themselves with "special" people and treat their employees like dirt, not for any particular corporate reason, but because they can - and it makes them feel good.

Their chief characteristics include a total lack of empathy, a huge sense of entitlement (rules don't apply to them) and delusions of grandeur.

Classic narcissists:

Leona Hemsley (RIP) "Taxes are for little people"
Rene Rivkin,

*********, caught insider trading.

The entire Enron and HIH gangs. (remember all the parties and grand gestures?)

A certain person who couldn't see what all the fuss was about when a relative was offered a major public honor to sway his vote on something, and who hates my guts for once publicly correcting him about an unimportant date.

A very very superior corporate person who had to surround themselves with Oxford graduates as their staff, and who was caught lying to the Board.

There are a heap of them out there, and if you ever feel uneasy about some person who appears like God's gift to mankind, then you may be looking at one.

Simplest test is to check very carefully at their ability to empathise with other people especially in random situations where they can't fake it.

Examples of lack of empathy:

Handing out expensive Christmas presents to senior management while at the same time telling your employees about the forthcoming layoffs and lack of pay increases.

Complaining about reporting schedules after being advised their finance and Administration Manager had just been diagnosed with incurable, terminal leukemia.

Females telling bad sex jokes in a bar in a private club.

I could go on.

these people will suck the life out of you and then curse you and throw you away for having no more to give them.

I'm not sure if any of them would become pilots - you can't fake things when dealing with nature.

[QFinsider]

You are correct Sunfish.

The corporation reflects the best of human endeavour however a sad reflection of today's corporation is its disfunction.

Last festive season friends produced a bottle of southcorp wine with the Q logo on it. I asked where it came from. My friend responded good friends are managers at Q, they had lots of bottles given to them for Christmas....

Pilots got our diary and an idle threat from Mannering about flogging continuing until morale improves!

The culture is disfunctional, the individual holding the office is disfunctional. He speaks as a yobbo, is an institutional bully, a self proclaimed Junk yard dog...This culture then flows through all levels of management and we have the mess Qantas is today.

[blow.n.gasket]

Sunfish,
for a moment there I thought you were describing the Chief Pilot at Qantas.

[flyingfox]

While all the talking is going on, I still wonder where the ASIC officials are. Terry McCrann has rightly highlighted the strange urgings of the QF Board to rush through the private equity takeover of Qantas. Some Board members stood to make a 'stack' in various ways if the bid had succeeded. Board members enthusiasm for the 'bid' seemed to be disproportional to the rewards available to shareholders. If it looks like a conflict of interest and 'quacks' like one might, then .......
It seems to me to be a case of the Board failing to act for the best interests of the shareholders (which is their job) and in fact trying to advantage the intended purchasers with a fire sale price tag. The asset stripping which would likely have followed a successful sale would have been an absolute binge. We saw it with Ansett in the misty past. The sudden departure of 'one' very prominent board member immediately after the 'sale' fell through seems to indicate that his interest for QF suddenly flagged when the 'quick-buck' potential of a low cost purchase suddenly evaporated. 'One' might also have not like the prospect of being around for any ASIC follow up!
So when does the ASIC action start?

[DEFCON4]

Probably the most apt description of Dixon and the Qantas Culture that anyone has come up with.
Hopefully things will change when the swine leaves.

[Sunfish]

I don't believe there will be any action by ASIC.

For a start, Qantas is lawyered to the hilt, and I'm sure that during the bid, no one at Board level even dared fart without a QC's opinion. You can rest assured that everything that was done was perfectly legal, and they will have the legal opinions, undertakings and minutes of meetings to back them up every step of the way...

And so will Mac Bank.

But that doesn't make it right, does it?

I could say more, but I don't want to do another six months in the sin bin for suggesting perfectly legal means and untraceable means of inducing company Directors to do what you want them to do, not that I am suggesting Qantas Directors have been influenced in any way of course.

[mrpaxing]

Qantas directors bag $13.2m



Margaret Jackson announced her retirement as Qantas chairman after an $11.1 billion takeover bid for the airline collapsed.
Photo: Andrew de la Rue

Advertisement
AdvertisementThe Qantas directors who backed a bungled bid for the airline have capped off a turbulent 12 months and taken home a combined annual pay packet of $13.26 million.

The combined remuneration package for the airline's directors increased by more than $2.2 million on the previous corresponding period, in a year highlighted by the failed takeover which underpriced the airline.

Managing director Geoff Dixon takes home the biggest slice of the pie, banking $6.7 million, up on the previous years amount of $5.3 million.

Outgoing chairwoman Margaret Jackson is taking home $592,000, compared with $534,747 previously.

Ms Jackson announced her retirement in May after an $11.1 billion takeover bid for Qantas by the Airline Partners Australia (APA) consortium collapsed.

Former Rio Tinto chief executive Leigh Clifford is taking up the chairman's role after Ms Jackson steps down in November.

PBL boss and Qantas non-executive director James Packer has been rewarded with $136,350, while retired general and non-executive director Peter Cosgrove will bank $239,435.

Mr Packer, who joined the board in March 2004, will resign effective from the airline's annual general meeting later this year.

The second highest earner on the Qantas board is chief financial officer Peter Gregg, who will receive $4.1 million in remuneration, while independent non-executive director Paul Anderson, will take home a salary package worth $163,838.

Non-executive director James Strong banked $219,088, while Garry Hounsell took home $316,915, boosted by a $50,000 bonus for chairing the target statement committee during the failed APA takeover.
:yuk:

[Syd eng]

So we are fighting to get 3% and he gets 25%+ no questions asked. No wonder Staff morale is low.

[QFinsider]

A 26% increase for what again?

giving up his day job during the APA debarcle
failure to disclose all relevant information to shareholders regarding the APA bid
talking down the value of shares for the last X years, only to see them miraculously improve when APA is around

Obviously worth every cent

[regitaekilthgiwt]

Now that we (Qf staff) are all shareholders, we should all unite and go to the AGM and voice our displeasure! :cool: Or we could call an SGM ??!