It was interesting to see new Qantas director James Packer at the Qantas Australian Formula One Grand Prix on Sunday.

Crikey now hears the rather extraordinary news that PBL had a good hard look at Qantas last year with a view to making a bid.

James Packer’s invitation onto the board clearly suggest he has a good
relationship with chairman Margaret Jackson but at management level the
really close liaison is between Qantas CEO Geoff Dixon and PBL Media
boss, John Alexander.

The Qantas magazine contract only went to ACP in 2000-01, before that they were with BTW and Fairfax magazines.

PBL CEO Peter Yates is supported by James Packer whereas Kerry Packer
would prefer to have John Alexander running the whole show. If James
was to be a professional director and ease off the executive duties at
PBL and the private Packer empire, Yates would be on his way out and
Alexander would be at the top.

Packer is said to admire Alexander almost as much as his affection for
Brian Powers during his time at PBL. This is hard to understand in some
respects but he likes his ruthlessness and ability to make assets work
hard – just look at the magazine turnaround.

The Packer executives driving a Qantas tilt

Sealed section – 9 March

More information reaches Crikey about Packer family interest in Qantas.

At least three years ago the Packer empire had a real tilt at Qantas with Macquarie Bank doing the work.

At the time it was regarded as a real long shot inside the Millionaire
Factory and attracted not quite the level of support and interest that
a typical Mac Bank deal generates internally.

The Mac Banker doing most of the running on it (ie the underling) was a
very smart boy (University Medallist and Young Liberal) named Ben
Brazil who got into a touch of trouble a little earlier on a Singapore
Power bid for PowerNet which they lost by $50 million to GPU (but they
then came back and picked it up for $500 million less a couple of years
later).

Anyhow, Brazil got sick of being on the sidelines at Macquarie so he
went to work for the Packers at CPH. Is he the man who did all the work
on a Qantas tilt by PBL last year? A lot of people wonder what on earth
PBL CEO Peter Yates – another Young Liberal, University champion and
former Macquarie Banker – does all day so maybe he’s looking for the
big deal to impress the Packers and stave off Kerry Packer’s push to
install John Alexander as CEO of the whole business.

This raises another scenario about James Packer’s presence on the
Qantas board. Is the media heir doing a bit of boardroom due diligence
before PBL writes out a cheque for $1 billion to take a 15 per cent
stake? Are they preparing to relieve British Airways of their 21 per
cent stake? You heard it hear first on Crikey folks. And if it doesn’t
happen, you still heard the wrong mail first on Crikey.

Is James Packer, the executive, retiring?

Sealed section – 2 March

Isn’t the appointment of James Packer to the Qantas board one of the most bizarre things you’ve ever seen?

At least he’ll get paid $120,000 a year by Qantas, which might
send a message to his tight-fisted dad Kerry who refuses to pay him
anything for chairing PBL.

However, most Qantas directors
love the free flights that it affords them and James Packer won’t be
taking this up as his preferred form of transport is the private jet or
the Channel Nine chopper.

PBL and Qantas have long had
commercial relationships though the inhouse Qantas News, magazine and
advertising. However, this new member of the directors’ club is still
very odd as James Packer is already overloaded with commitments. The
rumours are already flying that this might be a precursor to James
relinquishing executive duties at PBL.

Think about it for a
moment. James is the executive chairman of PBL, a diverse media
and gaming empire which turns over almost $3 billion a year. Why not
kick yourself upstairs and let Peter Yates become more than just the
chief executive by name.

James is also CEO of the
private Packer empire, Consolidated Press Holdings, which is
another multi-billion a year operation spanning Hoyts, a huge
chemical business, Jurlique, Challenger and various other investments.

As part of these commitments James sits on the board of Foxtel, Hoyts and US cinema operation Regency.

James
Packer is already one of Australia’s biggest boardroom truants. His
attendance record on boards like One.tel, Challenger, CDS Technologies
and even the NRL Club East Sydney was woeful.

The younger
Packer sat on the board of Easts for two years after the Super League
peace deal but failed to attend a single board meeting.

In
the last full financial year of One.tel’s short life James Packer only
managed to attend 9 out of 12 board meeting in 1999-2000.

The same thing happened at Challenger International where he managed just 3 out of 6 in 2000-01 and 2 out of 4 in 1999-2000.

The guy is just too busy and also loves to take long holidays.

So
why did he join Qantas? Is it about broadening his corporate
experience? Possibly, although he already has enormous boardroom
exposure.

This will be the first listed company board seat
for a Packer as a genuinely independent director. He won’t be
representing or protecting any of the Packer fortune.

The
Australian’s Jane Schulze got it wrong this morning saying this was the
first outside directorship for a Packer since Kerry sat on the Westpac
board in 1992-93. Kerry and Al Dunlap were in fact Westpac directors to
protect the Packer family’s 10 per cent stake, just like they sat on
the Challenger board to protect the family exposure. As far as we know,
Qantas is the first truly outside public company board seat taken
by a Packer. There is no precedent.

The timing is curious
because it comes just months after Qantas chairman Margaret Jackson
caused a storm in top level media circles by proposing a departure from
the Fairfax board to join Rupert’s News Corp empire.

This
proposal was shouted down but now we have Jacko, arguably Australia’s
most dedicated corporate and political networker, cuddling up to the
Packers. What would the Murdochs think of this? Are the Fairfax board
comfortable with one of their directors courting James Packer? You
would think not.

If Packer family influence can be brought
to bear in Canberra when necessary and against the formidable Qantas
unions, then it will make perfect sense for the airline. But that
doesn’t explain what is in it for the Packers.

When Kerry
finally falls off the perch and James inherits the empire, Crikey is
tipping that he will step back from executive duties and allow other
managers to run the show.

But his ruthless dad requires him
to work for no money in the mean time, something that might be about to
change if the Qantas appointment is any guide.