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Industrial Relations Rides Again…The Curse of ‘Two Strikes’…and the Remarkable Case of the Narrowing Field for M & A

Industrial relations has re-emerged this year, attracting intense media and market scrutiny of companies. Aviation, mining, ports, rail, and food processing are among the obvious sectors affected by lengthy disputes companies have found difficult to bring to a head. Media organizations have been dusting off Industrial Relations “rounds” that were downgraded or dismantled years ago.

Hintons has helped provide industrial relations communications support for some clients and seen affected companies covered by journalists uninterested in financial or economic arguments and focused instead on the politics of the system and the expert players within it. Historically, employer associations did much of the heavy lifting in the public arena – but not anymore. Now company people do the work – CEOs, business unit chiefs, HR specialists and corporate relations spokespeople. Many companies are not geared up for this, however, and lack the equivalent media “smarts” and delegated authorities to speak confidently that give union leaders their edge.

In a separate development, the controversial ‘two-strikes’ rule, which automatically triggers a shareholder ballot on a board spill if more than 25 per cent of investors vote to reject a company’s remuneration report for two years in a row, has injected fresh relevancy to annual general meetings. The “meeting” season rejoins the “reporting” seasons for investors, financial media, and proxy solicitation firms and advisors. As annual meetings have re-emerged in relevance, clients have sought Hintons support for key aspects of the messaging tasks this year.

On the transaction front, the mining, energy and agriculture sectors remain the focus of merger and acquisition activity in the uncertain economic climate, much of it with a cross-border flavour. The projected surge in global demand for hard commodities, such as coking coal and iron ore, and soft commodities, such as grain and sugar, continue to drive consolidation in Australia’s key resources and primary industries. This year Hintons advised, among others, Canada’s Barrick Gold on its acquisition of Equinox Resources, Eastern Star Gas on the friendly bid from Santos and TRUenergy and the US-based Bunge International in its bid for Tully Sugar.

Providing broader public affairs support, the Hintons team also collaborated with ANZ and economic consultants Port Jackson Partners on their landmark report, Earth, Fire, Wind and Water, outlining the size of the prize for Australia with the industrialising developing world underpinning extraordinary commodities demand for decades to come, and benefits potentially accruing across the Australian economy.

In other news, Hintons has welcomed a new member of the team in recent months. Felicity Williams is a former mining and energy reporter from the Herald Sun, where she cut her teeth covering BHP Billiton’s long-running takeover bid for Rio Tinto and their subsequent attempt to agree an iron ore joint venture. She holds a combined Bachelor of Asian Studies (Chinese) / Bachelor of Laws degree from The Australian National University and has lived and worked in China, Britain and Canada.

We were also pleased to re-launch our website in October which further expands our credentials and capabilities. This can be viewed at www.hintons.com.au

We are looking forward to touching base with you in early 2012 – but in the meantime, we warmly invite your feedback or thoughts on any topic above or ideas for future discussion. This e-newsletter is designed with our clients in mind, so if there is anything you would like to know more about we are only too happy to help.

HINTONS 2011

 Rio Tinto

Strategic advice on a number of issues

 AXA Asia Pacific

Strategic advisor external communications for takeover defence of AXA Asia Pacific

 ANZ

Strategic public policy positioning

 Spotless

Strategic advisor for takeover defence

 Barrick Gold

Strategic advice and media management bid for Equinox

 Bunge International

Communications advisor for acquisition of Tully Sugar

Qantas

Issues Management and strategic advice

 Jetstar

External and internal communications

 PPB – Manager and Receiver, Burrup Fertilisers

Communications advice and management regarding Burrup Fertiliser’s receivership

 Centro Retail Trust

Communications advisor regarding CER’s restructure

 Country Road

Strategic communications support

 CP2

Communications advisor for acquisition of ConnectEast

 Eastern Star Gas

Strategic advice and media management in relation to Santos takeover of ESG

 Wah Nam

Strategic advice and media management in relation to bids for FerrAus and Brockman Resources