Talking Business: May 21 2021

Amazon to Make $9 Billion Offer for MGM to boost Amazon’s streaming power.


Welcome to Talking Business, a podcast produced in Melbourne Australia. The podcast is available on the Acast app, the Apple Podcast store or wherever you go to get your podcasts. Or you can get it at the Business Acumen website at

I am Leon Gettler. My job is to review and monitor      the week’s news in business, finance and economics. I bring it all to you, every week.

This is episode number 16 in our series for 2021 and today’s date is Friday May 21.

First, I’ll be talking to Brian Westfall from global consultancy firm Gartner about how Australians and Australian companies are adjusting to working from home. And I’ll be talking to economist Saul Eslake about the Budget.

But now, let’s talk to Brian Westfall Inc is in discussions to acquire the nearly century-old Metro-Goldwyn-Mayer movie studio in what would be its biggest push into entertainment yet, according to news reports. MGM, the storied Hollywood company behind the James Bond series, would help bolster Amazon’s Prime streaming service, the Information and Variety said in separate reports. Amazon is weeks into negotiations to buy the studio for about $US9 billion ($11.5 billion), according to Variety. MGM has been seen as a takeover target for years, but was never able to close a sale. The company made a fresh push last year, when it reportedly hired advisers to solicit offers. In seeking a deal, MGM aims to capitalise on the proliferation of streaming services, which has increased demand for large backlogs of content. MGM traces its roots back to the 1920s merger of Marcus Loew’s Metro films with a film company run by Hollywood legend Louis B. Mayer. While making great pictures like Dr Zhivago and 2001: A Space Odyssey, MGM drifted in and out of financial distress in the second half of the 20th century. Over the decades it was owned by Time Inc, CNN founder Ted Turner and more than once by the late billionaire Kirk Kerkorian. There’s been speculation before about Amazon acquiring entertainment companies. It was previously seen as a possible buyer of AMC Entertainment Holdings Inc, the movie chain, with some investors confusing it with AMC Networks Inc, the owner of cable channels.


The traditional owners of the Juukan Gorge rock shelters have demanded they be given a seat at the table in future planning of Rio Tinto’s $1.5bn iron ore mine in an effort to prevent the further destruction of cultural heritage. The 46,000-year-old heritage-listed rock shelter was blown up by Rio Tinto one year ago against the stated wishes of the traditional owners, the Puutu Kunti Kurrama and Pinikura (PKKP) people. “We want to ensure that we’re around the table when it comes to making decisions about impact on our country,” PKKP Aboriginal Corporation spokesman Burchell Hayes said. “We’re not going to let this happen again.” Rio Tinto destroyed two rock shelters, dubbed Juukan 1 and Juukan 2, on 24 May last year. Juukan 2 was dated at 46,000 years old and described, in an archaeological report commissioned and paid for by Rio Tinto, but which its senior executives had not read, as one of the most significant archaeological sites in Australia. The company’s former chief executive Jean-Sébastien Jacques told a public inquiry last August that the sites had been destroyed to access an additional $135m worth of high-grade iron ore. Instead it resulted in an international backlash against the company, a moratorium on any mining activity at the site, the resignation of three senior executives including the CEO, the departure of two board members including the chairman, and a Senate inquiry with plans to overhaul cultural heritage management laws Australia-wide. In a video interview released ahead of the anniversary of the blast, Hayes said the loss of the rock shelters was made more devastating by the knowledge that it could have been prevented. He said it was impossible to compensate for the loss.




Virgin Australia’s chief executive has called for the country’s borders to be reopened before the stated goal of mid-2022, saying it made long-term sense even if “some people may die”. Speaking at a business lunch in Brisbane on Monday, Jayne Hrdlicka said she did not agree with the current stated reopening date of “mid-2022” put forward by the federal government in last week’s federal budget. Ms Hrdlicka said she believed, with a viable vaccine in place for a large enough portion of Australia’s population, the country needed to reopen its borders or risk being left behind by the rest of the world. The airline boss said as long as vaccination levels were high enough, and vulnerable people were protected, the country should take the risk of fully opening again sooner than June 2022. “COVID will be part of the community, we will become sick with COVID and it won’t put us in hospital, and it won’t put people into dire straits because we’ll have a vaccine,” Ms Hrdlicka said. “Some people may die, but it will be way smaller than with the flu. “We’re forgetting the fact that we’ve learnt how to live with lots of viruses and challenges over the years and we’ve got to learn how to live with this.”






The Fair Work Commission has ruled that a delivery rider working for Deliveroo was an employee and unlawfully terminated, setting a landmark precedent for Australia’s gig economy. After 4 years with Deliveroo, Brazilian national Diego Franco was removed from the app in April 2020 for slow deliveries; Deliveroo argued it could terminate Franco with just 7 days notice as he was an independent contractor; The FWC determined that Franco was actually an employee required to wear uniforms and use a system that organised shifts and measured performance. Deliveroo, which will appeal the decision, was ordered to reinstate Franco and compensate him for lost wages; “This ruling has huge implications for gig workers in Australia,” Transport Workers’ Union national secretary Michael Kaine said

A report by the International Energy Agency has determined investment in new fossil fuel projects must cease by the end of this year for the world’s energy sector to reach net zero emissions by 2050. Under the plan, unabated coal power generation ends in advanced economies such as Australia by 2030. Sales of new petrol-fuelled cars end by 2035


Super funds are on track for their best annual return in close to a decade as markets straddle record highs, with the March 2020 meltdown now a distant memory. The median growth fund grew 2.2% over April, bringing the return for the first 10 months of the financial year to 14.7%, according to research house Chant West. If super funds can hold on to that return for the next six weeks, it will be the highest annual return since financial year 2013, when growth funds surged 15.6% over the year.



The 3 million Australians who withdrew superannuation as part of the government’s early access scheme have already lost $4.7 billion in investment returns, a report from the left-leaning McKell Institute says. The $36.4 billion withdrawn through the “Early access to your super” scheme would now be worth $41.1 billion if it had continued to be invested in superannuation, estimates a report released by the institute on Monday. The scheme, which ended on January 1, let people who had lost their jobs or had hours cut to withdraw as much as $20,000 from their super accounts in two $10,000 tranches –  the average withdrawal for each tranche was $7645. The policy led people to withdraw superannuation at the bottom of the market, meaning participants have missed out on the subsequent economic recovery, which has resulted in super fund indices increasing by 15%- 20%, the report said. Applications to withdraw superannuation opened on April 20 last year, when the Australian stock market was trading more than 25% below its prepandemic peak. “The people who sold at this time turned one of the most popular financial sayings on its head – they bought high and sold low,” said the report. An individual who made the average withdrawal in both tranches has already forgone $2420 in investment returns, the report says.

A compliance officer at Victoria’s gambling regulator has told the Crown Resorts royal commission that the casino group lied to him while he tried to investigate how and why 19 of its staff were arrested in China in 2016. Timothy Bryant, a compliance officer at the Victorian Commission for Gambling and Liquor Regulation, told the first day of Victoria’s inquiry into the James Packer-backed group’s Melbourne casino licence he was “frustrated” in his efforts to get to the bottom of the incident. Chinese police arrested 19 Crown employees in October 2016, of whom 16 were later jailed for illegally promoting gambling in the country, prompting an immediate investigation by the VCGLR which only produced a confidential final report in February this year. The royal commission heard the VCGLR ordered Crown to produce internal documents relevant to the arrests and interviewed senior Crown executives, who denied there had been warning signs its staff were at risk in China ahead of the co-ordinated arrests. But Mr Bryant said it became clear that was untrue as he obtained more documents from Crown, often only after they had been produced for a shareholder class action stemming from the China arrests, and in evidence in last year’s damning NSW Bergin inquiry into Crown. Meanwhile, at the royal commission into Crown Resorts in Perth, which is running at the same time, it was revealed Western Australia’s gaming watchdog opted for a “wait and see” approach after being handed information from Crown Resorts indicating that more than 50 individuals may have been involved in money laundering at the Perth casino. Crown’s disclosure that criminals may have been using the accounts of subsidiary Riverbank to launder money was contained in an information pack sent to Gaming and Wagering Commission on December 14 last year, according to evidence presented to the WA royal commission. Documents presented to the royal commission include a letter signed by then Crown chief executive Ken Barton with an annexure that referred to suspicious bank account activities being reported to AUSTRAC. The annexure raised concerns about deposits being spaced out in sums of less than $10,000. The activity, referred to as structuring and cuckoo smurfing, is a form of money laundering where large transactions are broken down into smaller deposits to avoid detection.

Crown Resorts has formally rejected Blackstone’s takeover offer but is still considering The Star’s merger proposal, the embattled gambling giant told the ASX on Monday morning. The James Packer-backed casino giant said the US private equity firm’s revised offer of $12.35 – up from the initial offer of $11.85 – “undervalued” the company and was “not in the best interests of shareholders.” The Crown board, led by executive chairman Helen Coonan, came to that view after taking “considered feedback from shareholders” and advice from financial and legal advisers. The board also said it believed Blackstone faced significant uncertainty as to the timing and outcome of the regulatory approval processes.

And that’s it for this week. And next week, I’ll be talking to @WORKSPACES founder and managing director, Jenny Folley about how many businesses and offices are slowly bringing staff back to work but  still haven’t figured out that they need to change staff behavior at work. And I’ll be talking to Indeed economist Callam Pickering about the latest labour force and wages figures

In the meantime you can catch me on Facebook, Twitter and LinkedIn. And if you want leave a comment. Wishing you all a safe and healthy week. And looking forward to bringing you Talking Business next week.