Crikey

When historians look back on the great credit and sharemarket bust of 2007-08, last Friday will rate as one of the most interesting days.

The Opes Prime collapse will become emblematic for everything that was bad about this bust – greed, extravagant lifestyles, slack regulation, poor disclosure, short selling, hedge funds, stock lending, excessive gearing and appalling risk management.

Friday will also be one for PR schools to assess. We all know that Friday is the best day to dump bad news due to the early deadlines and tight space constraints for newspapers and the lack of any Saturday shock jockery.

The following events all happened last Friday:

• The teetering MFS decided to hold an EGM to change its names but the Andrew Peacock-led board and management were a complete joke in the face of sustained questioning from a range of disgruntled shareholders. Check out this Mayne Report account of the fiasco.
• The Allco-managed Rubicon Europe released its annual report, disclosing that Gordon Fell was paid a $2.1 million cash bonus in 2007. The $1 units are currently trading at 10c but Gordon is sitting comfortably in his wife’s recently acquired $30 million Point Piper mansion. In terms of pay for poor performance, this effort is one of the most outrageous of all time.
• The Allco-managed Record Realty announced a staged liquidation of its $2 billion property portfolio. When the owner of the ASX head quarters in Sydney raises the white flag, you know things must be really bad.
• Santos dropped its annual report, disclosing that ousted CEO John Ellice-Flint was paid an excessive $6.8 million in 2007. How big will that make his golden parachute?
• Frank Lowy conveniently dropped the Westfield annual report at 5pm which revealed his salary hit a record $16 million in 2007, even though the stock is down 20% this year.

That’s quite a cocktail of excessive pay, cynical PR and credit crunch fallout. Unfortunately for the participants, John Howard is gone and Australia is now led by a government intent on tougher regulation, better governance and a new sobriety when it comes to executive pay.

Meanwhile, with all this bad news floating around, the board of Alumina decided to drop its annual report and notice of meeting after the market closed on Friday. Call me a cynic, but is this post box company with just a handful of employees trying to hide the fact that they’re facing a contested election for the first time? These lads operate an overpaid lunch club which yours truly is hoping to join.

* Check out this Mayne Report video on the fun and games from Friday’s MFS EGM.