Although we all love monopolies as owners/shareholders at what cost do we really tolerate these practices generally??
A funny but disturbing anecdote from last week.
Breakdown on the information highway
The Australian April 08, 2006
DON'T be fooled by the words "public company". Although they appear to suggest that the public has some business knowing what's going on in the company that they own, in fact the role of the public is to provide the money.
It is then the role of management to say, "Thanks for coming."
When it comes to public information about the public company, "Limited" is the operative word.
We put this principle of public company management to the test. Bound by the sacred oath of the Fourth Estate to seek justice and truth, and generally pester people in the process, your humble scribe made his way to the share registry, the Computershare registry to be precise.
Computershare is the world's largest and only global share registry company. It is one of Australia's finest corporate success stories.
It was there in Sydney CBD's Carrington Street that we encountered a helpful lady who advised us to make a booking in order to use the Computershare information services. Inquiring as to the nature of our interest, not to mention our name and address and occupation, our helper began to look worried. It was as though she had mistaken the word "journalist" for "terrorist".
We confided that we simply wanted to view the share register of the toll roads company Macquarie Infrastructure Group (MIG), in line with the prescribed rights of public access under the Corporations Law and CLERP 9. She scurried off to take advice, and after a few minutes a tall, dignified fellow emerged from a doorway toting a thick edition of the Corporations Act.
Perusing the act, he politely read us our rights. By grand coincidence we happened to have a few pages of the Corporations Act at hand, too. We traded sub-clauses before our helper kindly invited us to make a booking to view the public information on MIG.
Archaic is too recent a term to describe the Computershare system for public inspections.
The search apparatuses were slightly up the technological food chain from the Dewey decimal classification; best described perhaps as somewhere between microfiche and MS Dos, though by no means as fast as microfiche. We wondered how Computershare had advanced so far in its global expansion in light of this antiquated technology.
We didn't find the offshore hedge funds, said to have planned a raid on MIG to oust Macquarie management and get the fees down. But we did notice Macquarie Newton SFM (Australian Absolute Return Fund) and MacNewton SFM Special Events Fund had soaked up a few MIG shares on March 1 and March 7 respectively, just before the stock surged.
Anyway, our Computershare consultant said, we would probably need a day or two to find what we were looking for. Searching by date of share acquisition was only available on a special Computershare service.
And so it was that we put in a written request for the public information and bunkered down for Computershare's stipulated seven-day wait.
After a few days a dedicated relationship manager advised by email that we could obtain the public information we desired but first Computershare would have to run it past MIG.
The answer came: "Further to your request, please be advised that the costs associated with producing a copy of the MIG share register on CD will be $4473.56 (including GST)." Nice touch that GST.
And it was nice to know that if you would like to search for a 5 per cent shareholder in your company, it's free, but if the shareholder has 4.99 per cent ... don't forget to bring your $4473.56 (including GST).
Computershare chief and founder Chris Morris wasn't available for comment yesterday on the premium valuations ascribed to public information these days. The law seems to say that the provider can charge "reasonable costs" for making this public information available for inspection, public information that has already been paid for by shareholders in MIG and passed through to Computershare by way of MIG's customer fees.
NO, transparency isn't exactly on the rise. Accountability either. In the case of MIG alone, the NSW Labor Government admitted this week, amid the fracas over the Cross City Tunnel, that toll road contracts for the M2, M4 and Eastern Distributor were not to be made public. A number of federal Government ministries and departments have been unable to quantify, or even comment on, the infrastructure bond and other subsidies for Transurban and MIG toll roads.
For their part, ASX and ASIC are unable to explain the meaning of MIG substantial shareholder notices and their exotic trading detail to the media.
And were one to wonder who might be executing trades in any stock these days, keep wondering. Thanks to the new anonymous trading regime on the ASX you can forget that.