People Power, tackling GPT and Peter Joseph

11. People Power registered – now for mission impossible

By Stephen Mayne, Australia's most unsuccessful candidate

The Age and The Australian both carried stories this morning on the putative political start-up People Power and yours truly got mentioned in passing. The Oz said I was the co-founder of the party, but that was of its stillborn 2001 version, not the latest incarnation.

The AEC last week finally announced that People Power has been registered as a political party, something earlier versions didn't achieve. This means the party will be eligible for those outrageously juicy $1500 tax donations once the current legislation receives royal assent next month.

I've got a contract with Crikey until September and won't be making any final decisions about a serious crack at the Victorian election until then, hence the reluctance to participate in any mainstream media discussion about the project. As a media tart, it was not easy knocking back interviews with ABC 702 and 2UE this morning, but you can't be a commentator and a political spokesperson at the same time – and besides, no definitive commitment has been made.

However, the introduction of proportional representation in the Victorian upper house means that anyone who gets a primary vote of 5% in the eight new regions is seriously in the race for the fifth and final spot. After all, good preference flows delivered Family First the sixth and final Victorian senate spot with a primary vote of just 2%.

As things stand at the moment, the demise of the Democrats means the Greens are likely to emerge with the balance of power in Victoria's Legislative Council, although Family First will be in the mix.

People Power founder and President Vern Hughes is talking big about running in all 88 lower house seats and 8 upper house regions – but there is a history of over-promising and under-delivering, so some hard-headed realism about the enormity of the project is needed this time around.

The challenge is to put together a credible team of candidates that can finance a $250,000 campaign – the bare minimum required for one decent flyer and the all-important how to vote cards on polling day.

The Age's story about a former Labor Party mayor of Whitehorse, Peter Allan, running for People Power on a no pokies platform is the first shot at what will probably be a minor party auction for the anti-gambling vote in the wake of Nick Xenophon's stunning 21.5% state-wide primary vote in the recent South Australia election. Gabi Byrne, a former pokies addict turned anti-gambling crusader, has also announced she's standing for People Power in Eastern Victoria

There's also speculation about Jack Reilly, a former deputy secretary of the Victorian Treasury and socceroo goal keeper at the 1974 World Cup, but a few names hardly amounts to 96 candidates state-wide.

At People Power's core is a constituency comprising carers and people with physical and mental health disabilities, and this draft policy platform is now being circulated to other would-be candidates.

It's certainly tempting, but political start-ups in stable and prosperous democracies are very hard to get off the ground, so we'll have to wait and see if this latest attempt gains any traction, let alone the balance of power in Victoria's upper house after 25 November. That prize is most likely to go to the Greens – the first time they'll have held such power on the Australian mainland.



21. The Oz and the activist gang-tackle GPT

By Stephen Mayne, revitalised shareholder activist

Corporate Australia has a history of companies getting a very soft run at their first AGM. That certainly could have been the case for the newly liberated GPT Group yesterday, after they won over crazy Jack Tilburn by promising to change the font in the annual report at a tea and scones routine two weeks ago. How cheap is he?

However, this tiny GPT shareholder flew to Sydney yesterday and let fly in what turned out to be an unscripted alliance with the property writers from The Australian, primarily Paddy Manning, that injected some much-needed life into a meeting that otherwise would have been as dead as a dodo.

I got up about eight times over the two hour gathering and at one point read out a detailed extract from this story in The Weekend Australian about GPT's recent over-the-top purchase of 50% of Melbourne's Highpoint shopping centre, which included the following:

One source told The Australian the Besens had hoped to get over $500 million for the stake, but were staggered at the amount of money thrown at them by the fund managers. In the end, GPT Group paid $621 million, claiming it would get an income return of 5.5% in the first year. Industry experts still cannot make the deal stack up on those numbers and say the price reflected a 4.8% yield on Highpoint's current income, the first time a big commercial property asset has sold for a sub-5% yield in Australia. Even the Lowys, unquestionably among the smartest, most aggressive retail property investors in the world - could not believe the price paid for Highpoint.

This was the basis for my attack on last year's sweetheart deal with Westfield, when two prime GPT shopping centre stakes were sold at book value to secure Lowy backing for the proposal to dump a 30-year association with Lend Lease and endorse a new imbalanced joint venture with the sharp lads at Babcock & Brown.

Lo and behold, only The Australian produced a decent report of yesterday's AGM stoush, although it didn't confess to having their own stories quoted at length in the attacks. The media works in curious ways, doesn't it? A paper reports something, an activist runs with it and then the paper reports the activist's public attacks, thereby further confirming the validity of the original story which was strongly contested by GPT.

Paddy Manning, the son of ABC legend Peter Manning, was also the founding editor of Ethical Investor magazine, so it wasn't surprising his story also took up GPT's interesting response to questions about the "catastrophe" near their Ayers Rock Resort in the Mutitjulu indigenous community.

After beating the drum on how great everything was at GPT it was refreshing to hear both CEO Nic Lyons and chairman Peter Joseph agree about the on-going tragedy in that community and the need for much more to be done.


22. Putting Packer-backer Peter Joseph through his paces

By Stephen Mayne, former ANI shareholder

When Kerry Packer passed away on Boxing Day, former St Vincent's Hospital chairman Peter Joseph was all over the media telling the world what a generous benefactor he had been.

This, of course, is the same Peter Joseph who is chairman of GPT Group and was a director of ANI back in 1991 when Packer lobbed one of the most infamous hospital passes in Australian corporate history – the notorious $2 million sale of his bleeding European environmental waste management business ABT.

This related party transaction was neither disclosed nor voted on by shareholders, but two weeks later Packer sold his remaining 30% stake in ANI, crystallising a profit of $200 million.

In 1994, Ross Palmer sold his company, Palmer Tube Mills, to ANI but made the mistake of accepting ANI shares for 90% of the proceeds at the nominal price of $1.90 a share. When ANI's European Holter-ABT division suddenly caused a $400 million write-down in 1996, the shares plunged and the Palmers found themselves seriously out of pocket.

Come 1996, Ross Palmer and another director, Fred Smith, were the only two independent ANI directors who didn't approve the ABT deal, so they steamed ahead with their own two-man board investigation and got some legal advice from Mallesons suggesting ANI should sue Packer for $400 million.

At this point, Peter Joseph proposed a special resolution and succeeded in having Palmer dumped from the board for being "disharmonious and disruptive" at the 1996 AGM. The resolution succeeded partly because Joseph's colleagues at BT lifted their stake from 3% to 15% and voted against Palmer. Sadly this wasn't too flash an investment and ended up costing BT about $40 million, which wasn't quite as bad as the $150 million they dropped backing the Packer's in One.Tel, but that's another story.

Anyway, I treated 260 shareholders in GPT to a little history lesson about this saga yesterday when it came to the proposal to give Peter Joseph another three years as chairman.

Given GPT's sweetheart deal with Frank Lowy's Westfield Group last year and the recent deal over Highpoint with Melbourne billionaire Marc Besen, I asked whether Joseph had a habit of going weak at the knees when confronted by a billionaire.

Sadly, acting GPT chairman Ken Moss ruled the statement out of order and said there was no need for Joseph to respond. As a long-time chairman of the St James Ethics Centre, Joseph has no doubt spent many hours contemplating what happened at ANI 15 years ago.

Copyright © 2024 The Mayne Report. All rights reserved

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