About the Australian Shareholders' Association
For over 50 years, the Australian Shareholders’ Association has been dedicated to standing up for shareholders.
Through its monitoring of ASX listed companies, advocacy and shareholder education programs, the ASA has been
instrumental in improving the financial literacy and engagement of shareholders and the corporate governance of
Australian companies.
MEDIA RELEASE
James Hardie to undertake further restructuring
Monday, 17 August 2009
James Hardie is embarking on another costly and complex distraction for its board and senior management while it
again tries to minimise tax obligations, this time by moving to Ireland.
The 2001 move to The Netherlands to ‘save tax’, which the Chairman promised would generate higher returns for
shareholders, backfired spectacularly when Dutch tax laws were changed.
Shareholders are now being asked to approve a further change in domicile to Ireland and will be given the opportunity
to have their say at its ‘Australian Information Meeting’ in Sydney tomorrow.
The company claims the move to The Netherlands has generated US$87.3m in tax savings. It fails to highlight the
US$20m spent on moving to The Netherlands and a further almost US$75m in advisory, tax residency and other costs,
including a US$50m in capital gains tax charge, that will now be incurred for to move the company’s intellectual
property to a Bermudan based company.
“James Hardie seems addicted to chasing illusory and fleeting tax benefits with ever more complex and costly
schemes when it could be building a better and stronger business to generate higher returns for shareholders”, said
Stephen Matthews, a spokesperson for the Australian Shareholders’ Association (ASA).
“The proposed costly move to Ireland will significantly erode shareholders’ rights with the elimination of Australian
Information Meetings, a prohibition on CUFs holders voting at AGMs and no provision for shareholder briefings.
“Worst of all James Hardie proposes to allow the board to remove a director without shareholder approval. That is
very, very dangerous indeed and could permit a board to act against the best interests of shareholders.”
Mr Matthews commented further, “No explanation is provided for the very costly proposal to transfer Hardies’
intellectual property to a company based in Bermuda, a place not exactly renowned for best practice corporate
governance”.
The ASA will be speaking against the proposal on behalf of retail shareholders at tomorrow’s Australian Information
Meeting and will again - as it did in 2001 - remind the board that tax driven decision making is a game exclusively for
losers.
For information please contact:
Stephen Matthews
Company Monitor
Australian Shareholders’ Association
Mobile: 0412 217 402
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