Inside Information
TNT (now part of TNT N.V.) was an Australian transport and logistics company with significant operations in Europe. It was a client of investment bank Macquarie Bank and in May 1996 TNT and their Macquarie advisors, from the Corporate Advisory Division of Macquarie Corporate Finance (MCF), had a meeting in Hong Kong with Royal PTT Nederland NV (KPN), the Dutch postal service, concerning a possible friendly takeover of TNT by KPN. Back in Sydney, the Macquarie advisors put together what they called "project Tennis", and those in this "Tennis team" were to keep the project confidential.
Hannes was an executive director of MCF, but not in the team, and so did not know directly of the proposed transaction. But he became aware something was happening, since in July 1996,
- One of his junior staff, Murdoch, was working on a valuation of TNT, which Murdoch told Hannes would be between $2.20 and $3.20 (which Hannes thought rather high).
- At a board meeting which Hannes attended, the subject of project Tennis came up, though the board was told only it concerned a major restructure of TNT.
- At a company conference in Mt Buller a slide referred to project Tennis and a possible fee of $5 to $10 million for Macquarie.
From 1 August 1996 Hannes took permanent leave from the bank, but kept keys to the MCF offices, since he would still be doing work for at least one client. Before and after taking leave, Hannes made a number of late night visits, the prosecution would allege that on those occasions he looked at the work of project Tennis.
On 2 September 1996 TNT announced it has made an agreement, with certain conditions, to sell its stake in Air New Zealand to Ansett Airlines. One of the things the prosecution would allege Hannes learnt from project Tennis was that KPN wasn't interested in TNT's shares in Air New Zealand, and that the prospect of a takeover would be greatly increased if TNT could sell them. It seemed that with this impediment removed Hannes took action, two days later.
Read more about this topic: Simon Hannes
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