Dick Pratt’s ascension to the presidency at Carlton has generated plenty of media attention but no one has yet pointed out the lovely corporate ironies.
Pratt must love the chutzpah of replacing Graham Smorgon as Carlton President after a huge member revolt. 20 years ago, Pratt’s Visy empire, the Smorgon family and Amcor engaged in one of the most famous corporate wars in history over the corrugated box market.
The pricing was absolutely vicious and at different times the Smorgon and Pratt empires came under severe pressure. In the end, the Smorgons caved in September 1989, selling three corrugated box plants to Amcor and two to Pratt.
Fast forward to 2007 and the ACCC is going the heavy on Amcor and Pratt for allegedly running a cartel in the box business. Maybe the Smorgon family, which BRW estimates is now worth $2.4 billion, could re-enter the box market to inflict some damage on Pratt and defend Graham Smorgon’s honor.
Dick Pratt’s empire almost collapsed after the 1987 sharemarket crash and some observers believe it was only the generous dealings of John Elliott’s Elders IXL which kept him afloat. No wonder he was such a supportive Carlton director under Elliott from 1985 until 2000.
ACCC chairman Graeme Samuel must also be enjoying the ironies. Samuel was BHP’s original adviser when Robert Holmes a Court launched his raids in the mid-1990s and helped solicit the separate white knight roles played by Elliott’s Elders IXL and Pratt, who bought 4.4% in conjunction with Kiwi entrepreneur and subsequent jailbird Allan Hawkins. Samuel, of course, was also an AFL commissioner from 1984 until 2003.
Carlton certainly benefited hugely from Elders-Foster’s and Pratt over the years, but still finds itself hocked to the eyeballs and in need of at least $5 million of Pratt’s estimated $5.2 billion fortune to stabilise its balance sheet.
The removal of Elliott as Foster’s chairman in 1991 and the installation of Pat Stone at the top of CUB saw the beer money that was pouring into Carlton slow down a bit.
Indeed, Stone was President of Carlton’s great rival Richmond and prevailed upon Amcor, its main packaging supplier, to pour $1.2 million into the club in “sponsorship” over three years in the mid-1990s.
Amcor didn’t want any exposure for this; it was just pleased to have wrested part of the contract back from Pratt at the time.