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New hope or no hope?

31 January 2015

9:00 AM

31 January 2015

9:00 AM

The ghost of a long-dead Sydney stockbroking firm is hexing Queensland Liberal-National Premier Campbell Newman in the closing stages of his State election campaign. He and his deputy Jeff Seeney have responded with defamation writs to the savage personal attacks by Sydney talkback king Alan Jones, conveniently rebroadcast during the campaign for no fee on the LNP-unfriendly Fairfax media’s Brisbane radio 4BC. At issue is the Newman government’s alleged ‘broken promise’ not to expand New Hope Coal’s mine close to Oakey on the Darling Downs, near where the Sydney broadcaster grew up. Whether Newman’s job-creating and economy-stimulating ‘good news’ triumphs over the environmental objections (an Australia-wide dilemma) will be resolved at the weekend.

When the Patrick Partners stockbroking/merchant banking empire went belly-up 40 years ago for a couple of million dollars (chicken-feed these days), one of its ugly duckling assets was a coal mine that supplied modest amounts of steaming coal to Queensland electricity generators. It was generally referred to, in house, as the No Hope Colliery. So there was little excitement when the late Jim Millner’s Washington H. Soul Pattinson Company acquired it for a price that apparently did little to meet the needs of Patrick’s creditors. But it has miraculously turned into a thing of real beauty – if market capitalisation is the measure; New Hope Coal, now a major Australian coal producer and exporter, is worth two billion dollars on the Australian Stock Exchange, with WHSP holding 60 per cent of the 830 million shares.


But those who lost money in the Patrick collapse will be more interested in the sixth largest shareholder with 15.5 million worth just under $40 million at current prices of around $2.50 a share. It is Farjoy Pty Ltd, the family company created by then Patrick Partner Frank A. Robertson (incorporating his initials with his wife’s name) who moved, just months before the collapse, from the partnership to run its merchant bank arm where New Hope was housed. Ten years ago, Farjoy had held 18.8 million shares, selling more than 3.3 million of them in 2008 when prices were around $4, suggesting a friendly pocketing of around $13 million – with another $40 million worth still in the piggy bank. This was quite a different result from the fate that befell the broking firm’s creditors and those of his former partners who ended up having to seek bankruptcy protection. A couple of Farjoy’s millions would have salved a few financial wounds, mine included.

So the Robertson family is significantly different from that indicated in a recent profile by Frank’s ubiquitous son Geoffrey Robertson QC, where his father was described only as a ‘bank worker’ with the family home being in the western suburbs – a far cry from the reality of leafy middle-class Eastwood (before the family moved to a very comfortable waterfront home on Sydney Harbour at Longueville) or from his father’s pre-stockbroking career as a senior officer in the Commonwealth Bank. So far from being a humble ‘westy’ who has ‘made good’, Geoffrey Robertson comes from a family of considerable substance. But New Hope’s political problems along with the collapse in returns for both its steaming and coking coal have more than halved its share price from the peak of $5.50 three years ago (when Farjoy’s shares were worth around $80 million). So it could be a toss-up whether the old ‘No Hope’ appellation is now more relevant to the company’s prospects – or to Campbell Newman’s electoral chances.

Don’t even think about skiing in Switzerland after last week’s dramatic effective revaluation of the Swiss franc against the Euro. The Swiss Central Bank’s sudden removal of the peg with the euro will also make Swiss francs about 20 per cent dearer for Australians, up from $A1.17 last year to more than $A1.40. And Eurozone skiing (Italy, France and Austria) is a bit cheaper than at Christmas when a euro cost $A1.52 – it is now down to $A1.42. So French champagne will remain relatively inexpensive (please never use the word ‘cheap’) in Australian liquor stores for some time as the euro joins our dollar’s downward slide against the greenback. All is not entirely lost.


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