Crikey

Woolworths, the country’s biggest retailer, has disclosed $87 million worth of related-party transactions between it’s ALG group and related companies associated with the CEO of ALH, Bruce Mathieson.

The Woolies 2007 annual report, released at 6.40pm last Friday, on the eve of the AFL and NRL Grand Finals, and a holiday long weekend in NSW, shows the related party deals in two groups. There were no transactions disclosed in the 2006 annual report.

The 2006 and 2007 Woolies annual reports list Mr Mathieson as the CEO of the ALH Group. Woolies partnered with his back in 2004 to bid for ALH. Woolies had been in a joint venture in Queensland with Mr Mathieson in the MGW chain of hotels and bottle shops.

He runs the hotels and their food, liquor sales and gaming businesses. Woolies is the country’s biggest owner of pubs and poker machines and they all fall under Mr Mathieson’s control.

The 2007 Woolies annual report said:

ALH Group Limited purchased various building supplies and services totalling $60,794,628 from Lifetime Developments Pty Ltd, a company with which Mr Bruce Mathieson is a related party through a family member/s who is/are a Director/ Directors of Lifetime Developments Pty Ltd. Amounts were billed based on commercial market rates for such supplies and were due and payable under commercial payment terms.

ALH Group Limited purchased various building supplies and services totalling $26,312,187, from TAG Constructions Pty Ltd, a company with which Mr Bruce Mathieson is a related party through family member/s who is/are a Director/ Directors of TAG Constructions Pty Ltd. Amounts were billed based on commercial market rates for such supplies and were due and payable under commercial payment terms.

These transactions were subject to review and testing on a sample basis by Woolworths internal audit. Significant construction activity is also subject to independent review by a quantity surveyor.