Construction giant Multiplex battles to regain market credibility after delays and cost overruns on Wembley Stadium, reports The Australian. But the losses are of less consequence than the weaknesses they have revealed in Multiplex’s management, says Stephen Bartholomeusz in the Smage. More disconcerting than the Wembley project itself is the damage it has done to Multiplex’s credibility – damage compounded by Multiplex’s response to the problem.
With hindsight, all the Multiplex danger signs were in the prospectus and ASIC should immediately review the practices Multiplex used to float at $4.05 now the risks are exposed, says Robert Gottliebsen in The Oz. Clearly, the combination of the Multiplex name and the John Roberts legend obscured the prospectus realities, which we all missed.
Newcrest mining has been pummelled by the market for a surprise production and profit downgrade, reports the Smage. More than $530 million was wiped from the group’s market capitalisation after announcing delays at its new $1.2 billion Telfer gold/copper project in Western Australia. The market overreacted, says the Fin Review’s Chanticleer. But the bottom line is simply that the market is in no mood for problems or excuses and when stocks are priced for perfection, anything less is hard to hit.
And The Age reports that Australia has rocketed to fourth in the world for initial public offerings. The Ernst & Young Global IPO survey 2005 found that IPO activity in Australia more than doubled last year – up 105% – with 166 deals raising $10.2 billion, driven in part by a significant increase for the first time in private equity-backed floats.
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