Shareholders of takeover target Patrick Corp
are not properly informed about the company’s intentions for one of its major assets and an important profit
contributor – the Pacific National rail operation it jointly owns
with its unwelcome bidder, Toll Holdings, says Bryan Frith in The Australian. In its target statement, Patrick seeks to justify its treatment of Pacific National in
the profit forecasts by arguing that it’s unable to predict how the
dispute will be resolved and therefore can’t assess any impact it
may have on the joint venture, and therefore on Patrick
– in other words, it wants its cake and eat it too.

Toll’s response to Patrick’s target statement yesterday was a
necessary part of the cut-and-thrust of contested takeovers, says Stephen Bartholomeusz in The Smage. But,
as Toll is the only probable bidder and, judging by
analyst responses, the market doesn’t seem to need
persuading that a combination of the two companies makes strategic
sense, the more critical moments in the takeover will occur in just
over a fortnight.

The high-stakes race to supply China’s
voracious demand for Australian iron ore stepped into overdrive
yesterday as BHP Billiton committed $US1.3 billion ($1.7 billion) to
expand its West Australian production, reports The Australian.
Following yesterday’s announcement from Rio Tinto, Australia’s two big
iron-ore producers have underlined their confidence in the Chinese
economy as the games begin for the coming round of talks to settle next
year’s contract prices, says John Durie in The Fin Review.

The Fin also reports that Australia’s financial overlords
are relaxed again after discovering that most Australians who increased
their debt to take advantage of high property prices haven’t blown
proceeds on shoe collections or deep suntans. The RBA found that just
11.7% of households increased their level of debt held against
their homes last year and is now convinced that about two-thirds of the
extra $20 billion borrowed went to buy other assets or pay down other
loans.

And we were intrigued by the new management speak in this job ad from today’s Fin Review (left).

Wine drinkers have never had it so good, reports The SMH.
A glut, described as the worst in decades, has caused retail prices to
plummet. Although grape growers are hurting, consumers are sipping it
up. Retailers
report selling some wines at up to half of what they cost two years
ago. And in music news, iconic Australian record label Festival
Mushroom
Records, which counts Kylie Minogue among its stable of artists, has
been
bought from News Corp by Warner Music for an undisclosed sum, reports The Courier Mail.

On Wall Street, US stocks ended sharply lower overnight, with the
Dow Jones posting its biggest one-day loss in nearly
four months, after a number of bellwether companies led by Pfizer, eBay
and McDonald’s posted disappointing results. The Dow closed down 133.03 points at 10,281 – MarketWatch has a full report here.

Peter Fray

Save up to 50% on a year of Crikey.

This extraordinary year is almost at an end. But we know that time waits for no one, and we won’t either. This is the time to get on board with Crikey.

For a limited time only, choose what you pay for a year of Crikey.

Save up to 50% or dig deeper so we can dig deeper.

See you in 2021.

Peter Fray
Editor-in-chief of Crikey

SAVE 50%