Now that Australia’s richest man has moved on and all this new information is
flowing into the public arena, perhaps it is time for one of the
great corporate mysteries of recent years to be solved. Does anyone
remember the saga of Kerry Packer’s involvement with
engineering
company ANI and the Four
Corners
story that resulted in 1997?

It involved Packer’s private company ConsPress selling a bleeding European waste management company called
ABT to ANI for $2 million in 1991. This related party transaction was
neither disclosed nor voted on by shareholders, but two weeks later,
Packer sold his remaining 30% stake in ANI, crystallising a profit of $200 million.

This saga very much revolves around Packer’s then CEO Al “chainsaw”
Dunlap, who is now a disgraced business figure in the US. Richard Walsh
noted in The Bulletin‘s tribute issue that ConsPress faced “an acute cashflow problem” in 1990-91, when Dunlap was brought in to clean up the mess.

Arguably the biggest disaster he faced was ABT’s $150 million contract
to build a waste treatment facility in Madrid which some observers
reckon was more likely to cost about $400 million. Oh dear.

In 1994, Ross and Sue Palmer sold their company, Palmer Tube Mills,
to ANI but made the mistake of accepting ANI shares for 90% of
the proceeds at the nominal price of $1.90 a share. When ANI’s
European Holter-ABT division suddenly caused a $400 million write-down
in 1996, the shares plunged and the Palmers found themselves seriously
out
of pocket.

Sue Palmer, a feisty American, subsequently spoke to Four Corners and claimed that Australians
lived in such fear of Kerry Packer that he could do just about anything he
wanted.

Come 1996, Ross Palmer and another director, Fred Smith, were the only two independent ANI
directors who didn’t approve the ABT deal, so they steamed ahead with
their own two-man board investigation and got some legal advice from
Mallesons suggesting ANI should sue Packer for $400 million.

At this point, ANI director Peter Joseph, the former chairman of St
Vincent’s hospital who publicly praised Packer’s generosity after he
died, proposed a special resolution and succeeded
in having Palmer dumped from the board.

The board committee was immediately dissolved and Bob Ellicott QC,
Malcolm Fraser’s former Attorney General and counsel for the
Packer-backed NRL during the Super League wars, was
commissioned to do an independent inquiry. His 300-page two volume
report has never
been released because ANI claimed at the time it was “defamatory” and
ASIC lacked the courage to make it public, in stark contrast to the
report by Alan Goldberg QC into the Yannon scandal that hit Coles Myer
around the same time.

Therefore, as you read this, we still don’t know whether there were
any misdemeanours surrounding those ANI dealings. The Packer family was
clearly sensitive as they sued Four Corners for defamation after the story went to air.

It has now been almost a decade since this played out publicly and there
are suggestions that the final losses from ANI’s adventures into
European waste management are now approaching $1 billion. Smorgon Steel
bought ANI for $850 million in 1998-99 but have apparently suffered plenty of
indigestion on the Holter-ABT contracts.

James Packer spoke movingly at the memorial service about being
surprised by the number of people who had come forward with stories
about his father’s generosity, now that his death had freed them from
confidentiality constraints.

Rather than having our grovelling Prime Minister commit taxpayers’ funds
to all this eulogising, the passing of Kerry Packer means that now is the time for ASIC to publicly
release the Ellicott report to put on the record once and for all what
happened during this controversial chapter in Australian corporate
history.

All we want is the facts, because the dead deserve nothing more than the truth.

Keep the Kerry Packer stories coming on this and any other issue to [email protected]

Peter Fray

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