Who made Australia’s rich list?

Ross Greenwood speaks to John Stensholt, AFR Rich List Editor, about the wealthiest 200 individuals in Australia

Introduction: Who made Australia’s rich list?

Ross Greenwood:  Welcome back to Money News, right around the country, great to have your company. Now we spent a bit of time talking about Frank Lowy there. We should actually talk about others on today’s Financial Review Rich 200 List that has just come out because, again as always, these stories are pretty spectacular. John Stensholt is the Editor of the AFR Rich List. He’s online right now. Many thanks for your time, John.

Interview with: John Stensholt, Editor, AFR Rich List

John Stensholt: Thank you, Ross.

Ross Greenwood:  We had spent a bit of time talking about Frank Lowy. Tell me about the rest of the list. Who’s there?

John Stensholt: Anthony Pratt, number one on the list, second year in a row, $12.9 billion. Visy cardboard making, manufacturing, recycling, but credit industries which he owns wholly outright by himself in the US. This is a really fascinating story of a guy going over to America, hitting it big and betting on the recovery in the manufacturing sector in Donald Trump’s Midwest heartland, and reaping the rewards.

Ross Greenwood:  In other words, there’s no doubt that Donald Trump has been good for Anthony Pratt?

John Stensholt: Think about the tax cuts, the corporate tax cuts, but also the 100% write-off value on big capital expenditure items. That’s been fantastic for a company like Pratt industry. They manufacture, they buy huge pieces of equipment. Quite often your first year, he reckons it could be worth an extra billion dollars to him over the next few years. That’s how big it is. That’s how much investment he’s making there.

Ross Greenwood:  As you come down the list then the next few, Harry Triguboff is always there or thereabouts. Where does he sit this year?

John Stensholt: Yes, number two, $12.77 billion. Gina Rinehart is after him, $12.68 at number three, so those are the big three really. They’re the only ones that are over $10 billion.

Ross Greenwood:  Still we’ve got three people in Australia worth more than $10 billion is what you’re saying.

John Stensholt: Yes, Ross. It’s almost like the uber rich isn’t it? I mean, that’s world-class that makes him.

Ross Greenwood:  It certainly does. Another thing also is just a number of billionaires in Australia. Now that’s the other thing that really got me about the list today.

John Stensholt: Yes, 76 up from 60 last year. We’ve transferred a few of them from the old families as we used to do, but there’s a lot of new work. A lot of people that have made a lot of money in the past year and tipped them over, and that’s a seven-figure mark. Someone like Chris Morris, he’s the founder of Computershare. He’s been around for years and years and years, but the share price of Computershare just keeps going up and up, so he’s just over the billion-dollar mark. That’s probably a good example. There’s people who are just making more money in the last year. It’s been a really, really good one, hasn’t it?

Ross Greenwood:  It certainly has. If you think about the moving commodity prices, which would be the reason why I say, for example Gina Rinehart, would have done so well over the past 12 months, while Twiggy Forrest would have done so well over the past 12 months. That really would be all about commodity prices, wouldn’t it?

John Stensholt: That’s right. You got the commodity prices going well, and therefore the stock market’s going well. The property market is still pretty good. In relative terms, it’s still very good really. It’s not going backwards at any huge rate. We’re not having a property crash. Harry Triguboff is still selling 1,000 apartments a year. He’s renting them out. He’s having them in the service departments for hotels to tap into the tourism boat. The property market is still very good too, Ross.

Ross Greenwood:  The other aspect to this are also really about the bottom end of the 200, because some have dropped off, not necessarily because their wealth has collapsed or anything like that, but actually because the threshold to get in to the list of the wealthiest 200 is rising all the time. What’s the cutoff limit this year?

John Stensholt: $387 million, so it’s up to little bit more than $40 million from last year. It’s a big rise and you’re right. It’s like the rising tide —  in that way. Harold Michels bought it, very powerful that man. He’s been around for years and years and years. He always jokes three’s sort of people on the list, the ones that want to be there, the ones that don’t, and ones that don’t really mind. He’s always put himself in that third category. He’s just missed the list this year, so hopefully Harold is alright with that.

Ross Greenwood:  It just is. What about some of the newcomers? Are there any newcomers that really do stand out for you?

John Stensholt: Well we’ve got Will Vicars who’s going to be on the list for the first time, a Sydney fund manager, $527 million, doing a fantastic job at Caledonia. We’ve got Justin Hemmes as well, $951 million from the Hemmes family hospitality and hotel and fire in Sydney as well, but you could see new names that are coming through like that. It’s across a diverse range of industries, Ross. It shows technology is growing and growing, but property is still there, manufacturing is not too bad either, so there’s still a diverse range of industries that people come from.

Ross Greenwood:  No, it’s interesting to note because if a person doesn’t necessarily live all the time in Australia, but they may have Australian citizenship, so say, for example, you’ve got a fellow called Vivek Sehgal I think it is, an Indian manufacturing tycoon. Just explain to people his story.

John Stensholt: Number nine on the list, he’s our biggest debutante. We found out that he’s an Australian citizen. Vivek Sehgal – Motherson is the holding company, I suppose, a big company for this huge Indian car parts manufacturing business. It turns out that he’s actually got Australian citizenship though. It was an economic, I guess way of doing that. 21 years ago, he took advantage of that and here he is today. He’s got some businesses here in Australia, but the vast majority are in North America where they supply car parts, rear vision mirrors, and the plastics components that go into cars. He’s supplying all over America and Europe as well. These are global businessmen really.

Ross Greenwood:  Amazing stories, they really are. It’s always got great stories out and around the place, but the truth of the matter is what you’re saying, bottom line is the past year, 2017-2018, the financial year has actually been a pretty good time to accumulate wealth, especially if you had wealth to start off with.

John Stensholt: Yes, exactly right. It’s a compound interest, isn’t it really, Ross? You build it up over several years, and it just keeps going and going and going, unless you do something silly to stuff it up, I suppose. There’s not many people doing that.

Ross Greenwood:  It was really interesting to watch. John Stensholt is the Editor of the Rich 200 List in the Financial Review that’ll be published tomorrow. John, as always, appreciate your time.

 

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