Crikey is thinking about running a campaign against the BHP merger and this guest contribution from an interested observer raises some good points.

The core values that initiated and built Australia’s great institutions like AMP and BHP has long gone from Australia’s crop of captains of industry and fellow gravy train travellers over the last two decades. Most wouldn’t make corporal.

That core value is intellectual business capacity and fearless entrepreneurial spirit. The lack of it is the hallmark of a branch office mentality and branch office economy and peso-value currency.

The Don (could that be spelt Dunce) in his ten years at the helm of former global aspirant NAB ensured that NAB had no-one who could possibly challenge him. The Don’s solution to the fine old mess he left behind was to pressure the Australian Government to allow the NAB to increase its Australian oligopolistic footprint which the Government had the good sense to ignore.

Take Pioneer for example. It was all too hard for Pioneer to cut the mustard internationally, so Pioneer buckled to the UK Hanson Group. Ironically, Dr John Schubert who previously presided over Exxon’s branch office in Australia was at the helm at the time. Some rationale about shareholder value or sumthin. Well, shareholders have to decide if they’re in business or not. Selling out is getting out of business. The military call it an advance to the rear and a precursor to total defeat.

For Australia, it’s back to the future and Australia’s previous incarnation as a branch office of the Great Britain, updated to branch office to the rest of the world.

The same at BHP in sleepy 21st century Melbourne

In a further twist of irony, the good Dr Schubert is also on the BHP board, where his previous branch office skills and buckling to global forces have obviously been put to good use.

Here’s how the BHP tune sounds.

Some sharp eyed non-branch office entrepreneurial South Africans running a fairly second rate mining company cast off by Shell, bulked it up to get it on the international investment radar screens (that’s the current broker/investment jargon, and most wouldn’t recognise a radar screen if irradiated by it) stitched together some acquisitions, including Worsley in Western Australia, then lined up, or relined up, BHP for the same treatment.

BHP’s hapless shareholders, owners of a once proud and confident company, who had no obvious successor to the current CEO Anderson whose exit ticket was already punched, now find out that they will be asked to pay the South African crew a 20% premium to effectively take control of BHP at no premium. Billiton, formerly in bulked up size pre BHP, was about the third largest South African company. Now, with its BHP subsidiary, it would rank as No 1. Investors with longer term memories will recall that they haven’t seen anything so breathtakingly audacious since the mighty Carlton and United Breweries was duchessed by Elliot’s Elders. Hats off to Gil and the boys.

No doubt the best part about it from the South African’s viewpoint is that Australia’s Prime Miniature leapt into the fray and endorsed it. Maybe an honorary AO is in the offing for CEO-elect Brian Gilbertson.

The funniest part is that the Don and Gil have, according to Robert Gottliebsen in today’s Australian newspaper, “both took the extraordinary step this week of putting their personal reputations and trustworthiness on the line by undertaking that BHP would maintain its real and effective head office in Melbourne for at least five and probably 10 years.”

Sterling and reassuring stuff. Within hours, it was announced that BHP’s oil and gas centre of gravity would move promptly to London.

How long BHP’s existing Board stays in place is open to conjecture. It’s hard to believe the majority owners of Billiton-BHP’s capital, managed by Gil and the boys who now call the shots, and cheered on by the now lame duck Paul Anderson, will keep on the old Board for long. They’ve done their job, thank you very much.

After all, there is no place for old branchies or bankies at the head office of a truly global company.

Might be a good idea if the Don and his current Board got Gil and the good ‘ol boys at the global end of town to put their personal reputations and trustworthiness on the line by undertaking to keep them on for 5-10 years. Any bets they get it?

As for this global push to HQ in London, Coke stills seems pretty happy in l’il ole downtown Atlanta. And the world’s biggest miner Alcoa seems perfectly happy in pitiful Pittsburg. What was that about flags of convenience?

Bewdy mates.

Back at the Don’s old stamping ground at NAB, his successor and CEO-nominate Frank is making a fine old global hash of things.

Seems like Frank and his head bean counter Richard McKinnon are now talking about exiting Old Blighty if they can’t cut a deal. A short time ago, the UK was the great white hope. That’s thinking global, Frank and Richard style.

The share price now values NAB at about US$20 billion. That’s after “bulking up” with the MLC purchase of about US$2.3 billion.

The rest of the NAB ex MLC is now about a two year low, valued at about $US18 billion. The market’s obviously right behind Frank and the NAB Board – Brutus style.

NAB need to find a banking version of Paul Anderson and Brian Gilbertson and maybe the BHP Board lead by the Don to show them how its really done when you’ve got your back to the wall.

Crikey Banking and Mining Correspondent