Fighting with Southern Cross in 2001 as defo battle raged

Oh well, another board tilt and another single digit result.

Crikey received only 857,418 votes in favour of his nomination for the board of Southern Cross Broadcasting this morning and the no vote was 21 million, so our primary vote in favour was only 4.1 per cent. Oh well, another $165,000 three-year sinecure passes us by and Paula is resigning herself to the prospect of returning to the bar next February.

But there was a major victory for shareholders because the board were mightily embarrassed by the withdrawal of the resolution boosting their retirement payouts.

So embarrassed in fact that this was the ASX announcement that sneakily went out at 5.51pm last Friday night:

"The Chairman of Southern Cross Broadcasting (Australia) Limited, Mr Geoffrey Crawford-Fish announced that the directors have decided that the business agenda item relating to increasing the Directors' Retirement Allowances will not be moved as a resolution at the forthcoming Annual General Meeting. In reviewing the situation, directors decided that in the current environment it was appropriate to consult further with shareholders and advisers."

So there you have it. Rather than getting rolled by the proxies, they snuck out an announcement to the ASX on October 26 which said it would not be proceed. Presumably the three largest shareholders, Deutsche Bank, Perpetual and the Commonwealth Bank had threatened to vote it down.

It really was one of the most scandalous snout in trough exercises I've seen for a while.

The remuneration committee comprises chairman Geoffrey Crawford-Fish and company founder John Dahlsen, both of whom are in their late 60s and approaching retirement.

The new retirement package would have seen these two old boys pick up a lump sums equivalent to 5-times their annual fees because they had both served more than eight years on the board.

Even worse was the proposal to increase the maximum payable to non-executive directors from $400,000 to $600,000.

Chairman Crawford-Fish took over the reins in March 2000 and saw his annual fees soar from only $57,585 in 1999-2000 to $128,000 in 2000-2001, and presumably is now going to get another increase.

Based on the new retirement deal, he was nominating himself for a package worth $640,000 - and that's assuming no increase now that the NED maximum has been lifted to $600,000.

Based on the way he stuttered and stammered his way through the meeting and refused to answer questions properly, this former liquidator has to rate as one of the worst chairs of an AGM I've ever seen.

And when I asked the question about why the related party transactions between John Dahlsen and legal firm Corrs Chambers Westgarth weren't mentioned, the Fish claimed the former long-time partner of Corrs was no longer a consultant to the firm.

That's funny, Crikey rang the Corrs switchboard early this afternoon and asked if John Dahlsen still worked there.

"Yes, he's a consultant to the corporate advisory division," the receptionist replied.

For the record, it should be disclosed that Corrs are acting for 3AW program director Steve Price in both a defamation and contempt of court action against Crikey Media and me personally.

After the meeting, Dahlsen wondered over with a puzzled expression on his face and asked: "what are you so angry about? The company is performing outstandingly."

I think he was serious and explained that I had a long track record of opposing cash for comment such that I was concerned about how the company was making it's money as well as the amount it was making.

During the meeting, The Fish responded to my speech opposing cash for comment at 2UE by reading from a letter the Australian Broadcasting Authority had supplied that morning confirming that the ABA was not presently investigating anything to do with cash for comment or Southern Cross Broadcasting.

So, clearly they think it is okay for the Penrith Panthers Leagues Club to pay John Laws a six-figure sum each year and for Laws to go soft on the gambling industry, despite the fact NSW has more poker machines per head than any other jurisdiction in the world apart from Nevada.

Southern Cross are to be commended for not unilaterally declaring that there was no vacancy on the board, but what about the way those institutions voted heavily against Crikey and then gave Marina Darling, another ex Corrs person, a yes vote of 99.9 per cent.

Do all of these dopey institutions forget that Marina was one of the GIO directors who cost shareholders more than $1 billion when its reinsurance book exploded.

Do they forget that she was one of the directors who recommended against the $5.35 a share takeover from AMP and is now being sued in a class action after the GIO share price subsequently plunged to about $2.50 as the reinsurance disaster became public?

Institutions seem increasingly willing to tackle the pay of directors - witness the surprisingly high 28.4 per cent no vote on the resolution issuing another 200,000 options to CEO Tony Bell - but just can't bring themselves to actually oppose the re-election of a director.

Given the scandalous nature of the retirement packages put up, the shareholders should have voted against the directors up for re-election as a further protest.

Copyright © 2022 The Mayne Report. All rights reserved

• share
  Share
  • 
    Facebook
  • 
    Twitter
  • email
    Email
  • print
    Print
  • link
    Copy Link
  • cancel
    Cancel