And here's a reminder that we're not the only ones concerned about the "hollowing-out" of our national exchange.

"Richard Holmes wrote:

It looks like we are about to lose another top Australian company, Perpetual, to overseas owners. (See KKR's Perpetual problem, October 18.) KKR are only going to do what was done to Myer. Then we have Foster's which might also disappear, with no Australian-owned brewer left in a country which consumes copious quantities of the stuff.

Why do company directors think selling their companies is the best result for shareholders? They are paid excessively well, along with their bonuses to run the company. If they cannot do it, resign and get someone else to do it. But then they have vested interests in a takeover, such as further bonuses for completing the transaction and a job on the board of the new entity lapping up directors fees.

If these takeovers continue at this rate, there will be fewer and fewer quality ASX listed companies to invest in. Where to then? Into managed overseas funds which rob the daylight out of unit holders with their fees, with no loss to the managers if things go bad? It will be the managed funds that determine what happens and they are only after a profit in the short term which does more for their bonuses than it does for shareholder returns.

18 Oct 2010 2:50 PM

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