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Vodafone NZ: Paris has skin in the game
Brokers are poised to put a new valuation on Vodafone NZ, once co-owner Infratil releases its half-year result on November 12.
And there will be a gang of small Vodafone NZ shareholders who could be keeping a close eye the figure: chief executive Jason Paris and his senior team - who ended up with small slices of equity under a management incentive scheme.
Infratil teamed with Brookfield Asset Management to buy Vodafone's New Zealand business, with each chipping in $1.03 billion, and Vodafone NZ taking on $1.34b in debt.
The new owners were keen for Vodafone NZ's management to have "skin in the game" a person close to the deal tells the Herald, so Infratil and Brookfield ultimately took 49.9 per cent stakes each, leaving around 0.2 per cent to Paris, and others including consumer director Carolyn Luey and business director Lindsay Zwart.
The slither was widely distributed, with Paris getting 0.03 per cent, other senior managers 0.02 per cent and some second-tier managers 0.01 per cent.
But the shares have full voting rights, Infratil investor relations manager Mark Flesher confirms. That means Paris and his cohort, on paper at least, hold the balance of power.
An insider told the Herald that Vodafone NZ managers had to stop up their own money for their stock, albeit with the new owners offering matching funds. Flesher said he couldn't comment individual's terms of acquisition.
So what are the holding's worth? In its 2020 annual report, Infratil gives its 49.9 per cent stake in Vodafone NZ a $974m book value - although with a footnote that where it also lists a fair value for various assets, that valuation is notably higher. Infratil's half-share in Canberra Data Centres (CDC) has a book value of $634m and a fair value of $1.52b, for example - reflecting a possible sale price).
In an October 28 research note, Jarden said Infratil was overly conservative on the fair value of its CDC holding, which it put at $1.8b. And it was also willing to put a market value on Infratil's 49.9 per cent Vodafone NZ stake: $1.3b, implying a total fair value of around $2.6b.
That would value Paris's 0.03 per cent stake at $780,000.
Of course, it's nothing new for telco bosses to own shares. But an insider notes they're usually dished out in tranches under long-term incentive plans that are often opaque in their formulation. With Paris and his team, it's pretty simple. If they create value, the worth of their shares will go up. If they don't, they'll fall.
A not so prestigious ranking
Banks are always trumpeting their successes in various ways and manage to make even a bad financial result sound like a good one.
But Westpac (the ASX-listed owner of Westpac New Zealand) has managed to get itself into the top five of a less than prestigious list this year.
According to financial analysis by Finbold, Westpac is the bank with the fourth largest fine so far in 2020.
Goldman Sachs topped the list as the most fined bank at €5.26 billion due to various violations. While Wells Fargo carried the second highest penalties at €2.53 billion.
JP Morgan Chase had €777.93m, just pipping Westpac to third place with the Australian bank being fined €770m.
The research also found the US, Australia and Israel account for 97.32 per cent of all €11.61b in bank fines this year.
The US was the highest by far at €9.150b, followed by Australia which was entirely made up of the Westpac fine.
Last month Westpac was hit by a fine from Australian regulator Austrac for A$1.3b for making 23 million financial law breaches in 2019.
Investigations last year revealed the bank had allowed transactions and transfer that funded terrorism and human trafficking.
Giving 100% - who could be Tourism NZ's new boss
The top job at Tourism New Zealand is becoming vacant at a time when the organisation faces its biggest challenge but when the local talent pool has arguably never been deeper.
Air New Zealand marketing and branding supremos Mike Tod and Jodi Williams have not outlined their long-term plans post the airline where their campaigns worked in lockstep with Tourism New Zealand's, whose boss Stephen England-Hall announced this week he was leaving after four years.
Tod and Williams have walked into airline jobs elsewhere in normal times but these are not normal times. Their widely acclaimed promotion of the airline overlapped marketing of the country, including the safety videos which were always aimed at the international audience.
Tourism Industry Aotearoa chief executive Chris Roberts has been in that role for six years, knows the industry inside out, is a strong communicator and knows his way around the Wellington bureaucracy and political apparatus.
Another name mentioned in the mix is outgoing MediaWorks chief executive Michael Anderson, who is being replaced by another Air New Zealand executive who's gone following radical changes on the top floor of Fanshawe St; Cam Wallace. (He punctuated his exit from the airline this week by selling 130,000 shares for just under $199,000.)
Anderson was linked with the OohMedia CEO role after the departure of Brendon Cook, but that position has since been occupied by Cathy O'Connor. Anderson previously told the Herald his intention was to keep his family in New Zealand.
Whoever gets the Tourism NZ job will be operating in an extraordinary environment as international tourism faces a bumpy recovery.
New Zealand will face unprecedented competition from other countries to attract twitchy travellers. The Crown entity with funding of $111m a year was at the marketing spearhead of near consistent growth for decades, picking up plaudits and awards.
Right now, instead of selling New Zealand to potential travellers from markets like Oakland, it's all about getting Kiwis out and about from places like Auckland.
England-Hall will take up his first operational role in tourism and big privately-owned South Island group, Wayfare, in January.
The top earner at Tourism NZ last year made up to $639,000 although England-Hall says it wasn't him.