Business News - WA
At Close of Business podcast October 15 2024
Nadia Budihardjo and Claire Tyrrell discuss Colliers’ somewhat surprising acquisition of Pritchard Francis.
Plus all the latest on CCC's blasts leak of WA Labor inquiry; Feds top-up live export support; and Takeovers Panel rules against blocking Rio Tinto move.
- Broadcast on:
- 15 Oct 2024
- Audio Format:
- other
(upbeat music) All the latest business news from WA, deliver daily. (upbeat music) At close of business, news briefing. - Good afternoon and welcome to the Outclose of Business podcast. I'm Sam Jones and I'll be reading your Tuesday headlines. The Corruption and Crime Commission has blasted the disclosure of information in an ongoing inquiry into WA Labor. The state's corruption watchdog released a statement this afternoon after multiple media outlets reported on an ongoing inquiry into alleged misuse of Labor Party electorate staff. In its statement, theCCC said recent public disclosure of information in the draft report of the ongoing investigation had been observed with great concern. They said the disclosure was unlawful with the procedural fairness process being undermined and warned it was a criminal offense punishable by up to three years imprisonment and a fine of $60,000. The WA Labor Party has yet to issue an official statement over the leaked inquiry information, but Deputy Premier Rita Safiotti said today she was not aware of the triple C investigation until this morning. And over to Canberra now, the federal government's $32.7 million top up of the fund to support farmers phasing out of the live sheep export industry has been lashed by political opponents. The federal agriculture minister Julie Collins announced today that the government would increase its fund to support WA sheep farmers following its decision earlier this year to scrap the practice. The federal fund set aside to support the transition from live exports by May 2028 is now $139.7 million. A total of $97.3 million of that will be used to help sheep producers adapt to new laws up from the initial offer of $64.6 million. In our first move on live sheep exports since taking the Ag portfolio from Murray Watt in July's cabinet reshuffle, Ms. Collins said the move would help industry transition to capitalise on other opportunities. The federal government will also invest $27 million in growing market demand, including exploration of development opportunities and promotion of products abroad. WA Liberal candidate for the newly created electorate of Bullwinkle, Matt Moran, said the response showed the government undersold the task when it initially set up its farmers support programme. And finally, the taker of a panel has ruled Uranium player energy resources of Australia's entitlement offer with Rio Tinto did not involve unacceptable circumstances. It means Perth fund manager Willie Parker and fellow ERA shareholders entry investments second attempt thwart the $880 million entitlement offer has fallen through. The two shareholders were arguing that the entitlement offer essentially paved the way for shareholder Rio Tinto to up its stake and potentially acquire the mine out at a low price. The takeover's umpire today announced it had declined to make a declaration of unacceptable circumstances in response to the two shareholders' application for review. It comes after it originally ruled not to get involved in the matter, but later backtracked and reopened the case after receiving that subsequent application for a review. ERA told the market it now intended to proceed with the entitlement offer as soon as possible and would shortly provide an updated timeline. That's all for today's headlines. You can read more at businessnews.com.au. Coming up on the podcast, Nadia Budihajo and Claire Terrell discuss Collier's somewhat surprising acquisition of Prichard Francis. (upbeat music) - I'm Michael Thompson, join the nine news team for the day's biggest stories and breaking news from across Perth, Australia and the world. The most trusted reporters on the ground with exclusive stories you won't see anywhere else. Plus WA's most comprehensive weather and the latest sports news with the inside scoop on the AFL. Finance editor Chris Collier also brings you the latest news on business from interest rates to the stock market. Nine news, your news, nightly at six, on nine and nine now. (upbeat music) - Welcome back to act closer business. I'm Claire Terrell and I'm here with Nadia Budihajo. How are you Nadia? - I'm good, how are you Claire? - Good thanks. For this edition, you have written about Collier's recent acquisition of a sibiaco engineering consultancy, Prichard Francis. When did this happen and how did the industry take the news? - Yeah, so the acquisition was announced in early September and it's the first WA acquisition by Collier's engineering, so that's Collier's engineering. And in the merger, Prichard Francis going to be rebranded to Collier's engineering and design. So that's really interesting because Prichard Francis actually been around since 1977. So to have that name change I think would be, I guess quite a major shift in the business. And I spoke to Prichard Francis, CEO Arthur Salters and he did mention that the news raised some eyebrows in the industry and it sort of was a talk in the BN office as well. I think the masks were saying it was a little unusual for Collier's which is known just for real estate and property management to do an engineering move. But Arthur mentioned, even though people were surprised by it, it wasn't really a bad surprise. It was still quite a lot of positive feedback. And he said there's a lot of work that was done to prepare for the announcement both internally for their stuff but externally as well. He mentioned it's not just an engineering firm buying another engineering firm. So he wants to make it more than just a simple acquisition. I was speaking to our colleague Mark Baier about this and he mentioned that it's not the first time that acquisition of local engineering firms have happened in WA. So he mentioned a case of Perth based VDM group who wanted to expand its engineering consultancy practices and acquired a bunch of different local engineering firms in 2006. But then by 2013 they were struggling and having to cut jobs and going through restructuring and they had to refocus their operations on procurement and mining since then. And they sort of failed to effectively integrate all of the acquired entities. So with that in mind, Richard Francis and Collier's are actually quite optimistic about their, I guess, their acquisition. So we'll see how that works because, as I mentioned, it's not the first time in WA that these local engineering firms are going through this kind of acquisition. But yeah, it's an interesting one for sure. - I remember their email coming through, I was on leave but always check my emails, can't help it. And I was like, what, Collier's engineering? - Yeah, cool. I think that was definitely the take in the office as well, especially with the marks when I was talking to them about it as like Collier's. (laughs) - But Collier's engineering has been making moves in the background. What else have they done? - Yeah, so I guess it might have been a surprise for us but it looks like Collier's have been doing quite a lot of progress to expand his engineering arm. So I mentioned it's the first in WA that they've done this type of acquisition but it's actually the third in Australia. So they've acquired Peak Urban and Craig and Rhodes in New South Wales, also engineering consultancy firms. And they've made, I guess, $4 billion in acquisitions over the past 19 years. Collier's also acquired Englobe in Canada, another engineering consultancy business. So they mentioned there's about 5,800 employees in Collier's engineering worldwide. So there's 370 people, 370 of them in Australia and I spoke to Collier's engineering managing director Brent Thomas and he estimated that by the end of the year, there'll be 500 people in Australia who are working in Collier's engineering. So it's interesting that they've been trying to diversify their business. Brent also mentioned that Collier's wanted to become the premier engineering consultancy in Australia. So it's sort of a way for them to be involved in all steps of the project, not just one side of the management but to be integrated in the design and the construction and the installation of the whole development. - Arthur Salters and Brent Thomas also mentioned a unique partnership model for the acquisition. What's different about this? - Yeah, this was also something that I think piqued my interests. So Arthur mentioned that the partnership model was actually one of the things that attracted Richard Francis when Collier's came to acquire them. So the leadership team from the takeover targets become significant shareholders in Collier's engineering. Brent Thomas also said that 30 to 35% of the business is actually owned by the employee shareholders. But in saying that local decisions will still be made, so it's sort of just a name change. He mentioned that the same people work with clients every day and with the partnership model as well, they're not gonna be barking orders. The people at the top are not gonna be barking orders or instructions. It's still about local ownership and empowerment and there's no change to the people. Arthur also mentioned that he doesn't think it would work out well unless this is the case. - You can read Nadia's story in the property section of the September 30 edition or online today. Thanks Nadia. - Thank you and thanks for listening. - The latest business news, deliver daily. Subscribe and rate the show wherever you listen to your podcasts. For all the latest business news, visit businessnews.com.au. (upbeat music) [BLANK_AUDIO]