V0 - AUSE01Z01MA WEDNESDAY, JANUARY 20, 2021 P13 theaustralian.com.au/businessreview

S&P/ASX200 -15.06 6742.6 ▼ CLEANING RICHARD STELLA GOLD -US16c UP GLUYAS WHAT? $US1836.89 ▼ DOLLAR Bingo play just the start Excuses will start to wear thin if Westpac’s What do you get when US77.1C +US0.19c ▲ for private equity { P14 } new team is unable to deliver { P20 } you combine Chrysler, Fiat and Peugeot? { P17 }

HERITAGE SITE UNCERTAINTY FORCES MINER TO PUSH BACK PILBARA COPPER PROJECT Power prices Juukan fallout slows Rio plans spark a

nal yet it intends to push ahead Stausholm gets the New Rio Tinto boss Jakob Michael L’Estrange, the Rio toll on many of us and, Rio’s iron ore shipments legal row NICK EVANS with the development of a giant Stausholm has used the Tinto board has zero credibility. understandably, many of you Million tonnes new iron ore mine at Simandou in message — but are company’s latest production Chair Simon Thompson has are disappointed and feel let 100 The impact of Rio Tinto’s destruc- Guinea, saying it had launched the board on board? report to underline his his work cut out to show the down,” he said. GLEN NORRIS tion of 46,000-year-old heritage early works at the project and ex- understanding of the market he too sees the “For this I am truly sorry. We 80 sites in the Pilbara could reverber- pected to update technical studies remediation efforts needed in importance of the relationship are working hard to heal and Australia’s largest energy class ate through its operations for on the infrastructure needed by the wake of the Juukan Gorge and is willing to back rebuild our relationships, 60 action will be launched in the years, as the mining giant con- the middle of the year. disaster. Stausholm. credibility and reputation — Federal Court on Wednesday, ceeded it doesn’t know how a re- “Activity at the mine area is The message from those Stausholm has come to the both internally and externally. I 40 alleging two Queensland gov- newed focus on relationships with starting, including roadworks. We outside is the new Danish boss job with an impeccable do not underestimate the time 20 ernment-owned electricity gen- traditional owners will affect its are progressing the implemen- at Rio Tinto gets the importance reputation — super-smart but and effort it will take to achieve erators manipulated prices. operations. tation of the project’s 2012 Social of the relationship with native with no ego, which is a this. I have met many of you 0 The action, initiated by law Uncertainty caused by the fall- and Environmental Impact As- title holders and understands it’s combination sorely needed. who care deeply about Rio and Sep Dec Mar Jun Sep Dec firm Piper Alderman and backed out of the Juukan Gorge debacle sessment,” Rio said. more than a moral duty — it’s At stake is Rio Tinto’s social our host communities. We each 2019 2020 by litigation funder LCM, has has forced Rio to push back the Rio finished the year at a rush, good business. licence to operate at a time have a role to play and, Source: The company been filed on behalf of 40,000 development of its Winu copper shipping 88.9 million tonnes of ore The question mark when its reputation is in tatters. collectively, we will learn from customers who paid for elec- project in the Pilbara, with the into a roaring market for the steel- remaining is whether he has In a note to staff on Tuesday this sad incident and put lion tonnes in 2020 — and flagged tricity in Queensland between mining giant flagging the need for making commodity in the De- board backing, because based he said all the right things. ourselves in the shoes of others longer-term impacts from the fall- January 2015 and January 2021. further discussions with tra- cember quarter and lifting output JOHN DURIE on the report prepared by “Juukan Gorge has taken its Continued on Page 20 out of the destruction of the heri- The majority of registrants in ditional owner groups over its guidance for 2021. tage sites at Juukan Gorge. the case against generators CS development, and saying it could Rio released its December- “The future impact on our Pil- Energy and Stanwell are resi- still not quantify the impact of new quarter production report on produced 334.4 million tonnes of ed output, but still behind where it the market in 2018. But fires at movement at its Brockman mines bara iron ore operations, mine dential users, but more than heritage laws likely to be passed in Tuesday, saying its Pilbara mines iron ore in 2020, up 2 per cent expected to be a few years ago. processing and handling facilities emerged. developments and heritage 1600 businesses also have signed Western Australia this year on its shipped at a rate of 355 million compared to 2019. Rio had originally expected to at its ports, as well as lost ship- Rio’s iron ore division is getting approach from the reform of the on. future operations. tonnes a year in the quarter, tak- The mining giant lifted Pilbara ship 338-350 million tonnes of ments from Cyclone Veronica, back on track, but is still shipping Aboriginal Heritage Act 1972 Piper Alderman dispute res- And, in the December quarter ing the company’s annual ship- guidance to a range of 325-340 iron ore from the Pilbara in 2019, forced Rio to cut its guidance, to significant quantities of lower- (WA) remains unknown,” Rio said olution and litigation team head production report released on ments to 330.6 million tonnes. The million tonnes in 2021, a record an improvement from the record 333-343 million tonnes, and then grade ore — 1.8 million tonnes in on Tuesday. Greg Whyte said the firm had Tuesday, Rio gave its clearest sig- mines Rio operates in the Pilbara rate if it hits the top end of expect- 338.1 million tonnes it moved into again when problems with ore the December period, and 6 mil- Continued on Page 16 spent more than two years inves- tigating Stanwell and CS En- ergy’s conduct on the National Electricity Market (NEM), which allegedly involved manip- Active fund managers ‘Beware Biden’s ulating the pricing system and artificially inflating consumers’ electricity bills. clean up amid chaos “There is a lot of complexity China trade bid’ in generation and power prices,” Mr Whyte said. ideas, but our cash reserve also “The conduct occurred at the DAVID ROGERS helped,” Mr Goldberg told The ond largest, finished the year on a generation stage and retailers MARKETS EDITOR Australian. EXCLUSIVE high note. Gross domestic prod- passed that cost through to con- “I don’t want to pretend for a uct rose 6.5 per cent in the fourth sumers.” The most extraordinary year for second that we picked GLENDA KORPORAAL quarter from a year earlier, ac- He said the action would seek financial markets in living mem- COVID-19, but we had concerns cording to data released by the to prove that the state-owned ory was a good one for active about the broader market be- Australia will need to keep a National Bureau of Statistics on power generators manipulated equity fund managers, particu- cause the market was expensive watching brief on the policies of Monday, marking China’s best the wholesale cost of electricity larly those who were wary of and it was getting harder to find the Biden administration to make quarter of year-over-year growth for their own profit, amounting economic risk before COVID-19 stocks that were attractive and sure it is not dealt out of trade with in two years. to a hidden tax. struck and also took the oppor- cheap, so we had built up a cash China, one of the nation’s top China would continue to be Brisbane business owner Iain tunity to add structural-growth position of about 35 per cent by trade experts has warned. one of the world’s strongest econ- Saul said he registered in the and cyclic exposures after the the time COVID hit. “There is no indication, apart omies and many countries would class action to help highlight the sell-off. “But the real key was being from his political appointments, continue to want to trade with it impact of soaring power prices Passive funds made subpar able to allocate that capital when on which way he will go with in the wake of the COVID-19 on the economy. “I don’t want returns in the year to the end of the market was panicking. China,” said Helen Sawczak, for- pandemic, she said. anything out of it personally but I December as the S&P/ASX 300 “I think we did more buying in mer CEO of the Australia-China Ms Sawczak, who was speak- want to help other people,” said index fell 1.2 per cent and divi- 2020 than we did in the two or Business Council, referring to US ing to The Australian ahead of a Mr Saul, who runs an electronics dends were crimped by a combin- three years before that.” president-elect Joe Biden. speech to Hong Kong-based company. ation of recession and the After the index dived as much “He has campaigned in a very trade and tech consultancy Lynk He said he had noticed a sig- regulation of banking sector pay- as 39 per cent from a record high hawkish manner during the elec- later this week, said observers in nificant increase in power prices outs. But the top 10 active equity to a 6½-year low in the space of tion but he has also campaigned Asia were “aghast” at how Aus- over the last five years. funds returned 24 per cent on just five weeks — marking its in support of multilateral bodies tralia’s relationship with China CS Energy and Stanwell average, according to Mercer’s sharpest sell-off since the 1987 such as the World Trade Organis- had gone from the signing of a dominate power generation in closely watched Australian crash — Collins Street waded ation and World Health Organis- “gold standard” free trade agree- Queensland and in 2018-19 con- Shares Investment Manager Per- into a couple of companies via ation, which bodes well for more ment that came into effect in 2015, tributed $895.2m in net profits. formance Survey released on heavily discounted equity capital conciliatory policies towards to the current low point in the pol- Mr Whyte said the firm Tuesday. raisings in March and April and China. itical relationship that was now would seek an order that the But it was also a year in which then continued buying in the fol- “Australia needs to watch damaging trade ties. generators repay the amount unprecedented fiscal and monet- lowing months, adding about closely what happens on US- “People who also trade with they had gained from the con- ary policy stimulus trumped seven new positions in total. China relations. China are looking aghast at how duct, equal to about $1000 per economic concerns and vaccine Collins Street’s performance “Every trade deal the US does we have gone from what was the residential customer and more developments, and the US elec- was also enhanced by its holding with China could help American gold standard in terms of trade for business customers. tion outcome added to the mar- of gold stocks — where profits farmers and mean there is less deals, which was the envy of the “The conduct of Stanwell and ket’s upward momentum. were subsequently booked — that China buys from us. world, to the absolute pariah we CS Energy has had a devastating Whereas long-short funds — and the stellar December-quar- “Any US trade deal with China are now,” Ms Sawczak said. effect on the Queensland econ- better known for their hedge ter jump in the uranium sector. will have a flow-on effect on She said Australia’s decision to omy,” he said. fund strategies — topped the But as a value fund manager, Australia.” very publicly ban China’s Huawei The total amount sought in league tables in the first half, the Mr Goldberg shuns the high-fly- Ms Sawczak, who is now a sen- and ZTE from supplying its 5G the action, being fought on a no- long-only funds excelled in the ing technology sector. ior adviser with investment bank network and a string of rejections win, no fee basis, is not yet second half, with “buy and hold” “From a valuation perspec- Moelis and a trade consultant, for Chinese companies bidding known. strategies generating the best tive, it’s hard to get a sense of said while the US was one of Aus- for Australian companies, plus its Mr Whyte said that while the returns. what Afterpay is worth, even if it tralia’s closest strategic allies, strong call for an inquiry into the firm would seek an early settle- Collins Street Value Fund co- succeeds in everything it’s seek- when it came to its trade interests origins of the COVID-19 pan- ment of the case, it could con- founder and managing director, ing to achieve and I’m a bit ner- it would put America first. demic, had helped to push politi- tinue for several years, with Michael Goldberg — who’s fund vous about these prices,” he said. “We should not presume that cal relations with China to new economists and electricity mar- topped the Mercer tables with re- However, the surge in After- just because we have a strong lows. ket experts called as witnesses. turns of 43.6 per cent for 2020 pay last year was a key perform- strategic relationship with the US Ms Sawczak said there were Stanwell and CS Energy say and 32.2 per cent for the Decem- ance driver for Hyperion that it is going to translate into more than 100 countries which, they will defend the action. ber quarter — says the concen- Australian Growth Fund, which economic matters,” she said. like Australia, had China as their A Stanwell spokeswoman trated portfolio allowed by his returned 33.7 per cent in 2020 “Australia needs to put Aus- major trading partner, many of said it strongly denied any alle- investment mandate, combined and 16.3 per cent in the Decem- tralia first.” which also had differences of gation of misuse of market with a fortuitous decision to raise ber quarter. Her comments came as figures opinion on many issues. power. cash levels in 2019 and then buy Hyperion bought Afterpay AARON FRANCIS released this week showed But she said Australia was one “We are totally transparent in on dips, set the fund up for its shares at about $50 a share after Helen Sawczak says Australia ‘needs to put itself first’ in trade deals China’s economy, the world’s sec- Continued on Page 16 Continued on Page 14 performance. realising that the “buy now, pay “We’re very fortunate that we later” operator would survive the have a concentrated mandate looming recession and assessing and that our clients have had regulatory risk as minimal, while patience and faith in our best Continued on Page 19 Tyro hits back against ‘alternative facts’ The Agency in admin as

price in a sign that public short at- $2.90 tech” in Australia and accused it debt dispute gets serious CLIONA O’DOWD tacks are losing traction with in- $ Tyro Payments closed up 25% of having no disaster recovery vestors. 4.50  plan following the software prob- negotiate high-profile sales in Tyro CEO Robbie Cooke believes “Everybody’s entitled to an 4.00 lem that has plagued its terminals LISA ALLEN prized suburbs on the east and it is inevitable the fintech will lose opinion; I’ve got no problem with for the past two weeks. BEN WILMOT west coasts. customers following the software that. But what I do have a problem 3.50 Viceroy made its name target- The company founders split glitch that has rendered a swathe with is when people put a set of al- 3.00 ing listed South African furniture Sydney’s prestige property mar- from John McGrath’s listed Mc- of its widely held payment termi- ternative facts out there. Clearly 2.50 retailer Steinhoff, and before that ket has been rocked by the ap- Grath agency as it suffered a pre- nals useless, but says the company the base facts in the Viceroy re- made bets against the now scand- pointment of voluntary cipitous share price fall soon after is taking action to ensure such an port are just so wrong. They never 2.00 alised German payments group administrators to parts of listed its ASX listing back in late 2015. event never happens again. contacted the company. They 1.50 Wirecard. real estate firm The Agency Sydney boutique investment Speaking to The Australian didn’t make any inquiry,” Mr 1.00 “Viceroy Research believes Group over an outstanding debt group Magnolia Capital’s an- after Tyro issued a rebuttal to Fri- Cooke said. Tyro presents a limited-risk short of just $379,000, with a once-sup- nouncement that it had called in day’s attack by short-seller Vice- “It was very important to us to 2020 21 as customers churn in record portive lender saying it had lost BDO as voluntary administrators roy Research, Mr Cooke said the get the correct information in Source: Bloomberg numbers to vastly superior, non- confidence in the company’s over parts of The Agency yester- report on the embattled fintech front of the people who had read archaic payment solutions pro- board. day sparked yet more clashes was full of “alternative facts”. the report, and that’s what we’ve scathing report, labelled the ASX- viders, which are available in The listed company is a min- within the egocentric world of CHAYA GOLDBERG The forceful defence triggered done.” listed Tyro the “most unreliable abundance, and immediately,” now on the ASX but has an out- high-priced real estate, although Collins Street Value Fund co-founder Michael Goldberg a 26 per cent surge in Tyro’s share Short-seller Viceroy, in its and technologically inferior fin- Continued on Page 19 size influence as its agents Continued on Page 19