The last tobacco shareholder meeting in Australia
By Stephen Mayne
January 14, 2008
This was sent to Crikey subscribers on April 30, 2001, just two hours after the last ever tobacco shareholder meeting in Australia.
Greetings from a Sussex St net cafe in Sydney after the last ever tobacco company shareholders meeting in Australia. Nick Greiner will probably end up pocketing about $1.5 million from his decision to be chairman of WD & HO Wills about five years back.
After Wills and Rothmans merged last year to form British America Tobacco Australasia Ltd, the giant British parent decided to mop up the remaining 40 per cent of the stock in British America Tobacco Australian Ltd they didn't own.
For a change minority shareholders got a decent mop up price which the likes of Shell Australia and AMP (GIO mop up bid) should take note of.
When you're talking about "Big Tobacco", look no further than BAT Plc which flogged $70 billion worth of its cancer sticks globally last year.
The industry is perennially getting whacked by first world governments and therefore is moving more aggressively into the more unsophisticated third world for new sales.
Chairman Nick lamented the latest attacks on tobacco by government and cited the Tassie Govt's recent decision to ban smoking in pubs and clubs whilst food is served as an example of retrograde regulation.
Lets hope Steve Bracks follows suit in Victoria just to give the Packers another whack at Crown Casino. Don't hold your breath on that one.
As is typical these days, Crikey had a barney with the BATA spin doctors and lawyers just getting in the door of the Four Points hotel near Darling Harbour.
I bought $200 worth of shares last Monday as it usually takes five days to get on the share register. But alas, this didn't happen with BATA so I politely said I'd instead go in as a visitor.
But because I wasn't on the approved visitors list, this would have to await the chairman's personal approval which would be difficult given the meeting to approve the takeover had already started.
After a bit of debate and a very thorough search of the bag (complete with smelly jocks) I was allowed in but after a couple of minutes the inhouse lawyer came back and told me to leave.
We then had a fairly vigorous argument outside as I produced my journalism passes and told them no other Australian company bans journalists and very few bans passive visitors.
After promising not to ask questions, they finally relented but only for the first meeting as chairman Nick would have to approve my attendance at the subsequent AGM.
Once back inside, Nick was already adjourning the meeting and calling for a poll so I went back outside and got straight on the phone to Paula in Melbourne asking her to fax through the BATA contract note to the hotel.
Chairman Nick is not chairman of spinning outfit Turnbull Porter Novelli for no reason and told his flaks and lawyers to let me in as a visitor for the AGM.
But by this time I'd produced the contract note which clearly showed I was a shareholder and the transaction had settled so I turned up the heat and said I was happy not to vote but wanted the right to speak.
After another flurry of discussion caucusing this was approved so when question time arose I made it all worthwhile for the board by heartily congratulating them on negotiating such as healthy 40 per cent premium to the prevailing market price.
With only one other shareholder offering a brief congratulatory gesture to the board, I asked three other questions.
It seems bad debt charges quadrupled to $4.1 million because of a couple of slow-paying customers and a general decline in the economy. I'd reckon the GST would have been a small factor in this too.
Asked about retirement benefits for directors, Nick said they would get the standard three times annual board fees. Nick picks up $240,000 a year as chairman so he stands to collect a very handy $720,000 retirement package for leading the lobbying of government in a non-executive capacity.
And all the while he's still picking up that beautiful taxpayer-funded pension of almost $100,000 a year dating back to his time as Premier of NSW.
Nick has stacked this board with other well-paid Tories who are becoming increasingly less useful as Labor takes over government across the country.
Nick's former planning Minister in NSW Robert Webster takes the tobacco shilling and will no doubt be looking forward to his $180,000 golden handshake.
As will accountant Ken Spencer, the preferred auditor of controversial Victorian Liberals such as Ron Walker and Jeff Kennett.
Ken audited Hudson Conway for a few years and also joined the Crown board about three years back. And when Jeff Kennett wanted to neuter the Victorian auditor-general, he called in Ken Spencer to be on his expert private sector committee to do the job for him. We won't forget this Kenny just like we don't let Southern Cross Broadcasting founder John Dahlsen forget the fact he also recommended this disgraceful gutting of Victoria's independent watchdog. The Poms at BAT Plc are expected to let most of the directors go so people such as Rupert's former Aussie spin doctor Geraldine Paton and fashion guru Carla Zampatti will also get their $180,000 cheques.
The other notable Tory on the board is advertising man Greg Daniel, whose worth is disputable given that tobacco advertising is banned in Australia.
Not wishing to let down our friends at Save Albert Park, I also asked about the prospects for tobacco advertising through the Grand Prix to slow the $10 million annual losses Victorians are stumping up to Bernie Ecclestone and his cronies.
Nick said this was being banned globally in 2006 and until then it would remain a year by year proposition. Nick has been very effective in persuading his mate, Federal Health Minister Dr Michael Wooldridge to give it the all clear for each of the past five years. Shame on you Doctor.
I also noted how sad it was that tobacco manufacturing was yet another Aussie industry to fall completely into foreign hands and at the end of the meeting Nick also signed off with a sad note given the closure on this "great Australian company" and noted it was "the reality of globalisation in fast moving consumer goods industries".
Can anyone think of an Australian owned global brand in fast moving consumer good with the exception of Foster's?
And think of all that rich history of sporting sponsorship through Winfield, Benson and Hedges and Dunhill which is now all subsumed into the tobacco branch office here in Sydney.
We ain't world leaders in this sin industry but at least Sydney can gloat to have the second biggest manufacturer of gaming machines in Aristocrat. Ain't we a high achieving nation at business to star in such a prestigious industry?
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