Thursday, 13 March 2008

Wealth or control: which do entrepreneurs want most?

As shareholders in Auckland International Airport ponder whether or not to sell their shares to Canada Pensions, and Canada Pensions meanwhile pledges if successful to retain an ownership stake up to forty percent but to sell down its voting rights to 24.9% -- and ministers David Parker and Clayton Cosgrove ponder whether or not to make these voluntary decisions moot by dropping the hammer on shareholders and buyers alike --  it's worth taking the opportunity ourselves to ponder the difference that entrepreneurs see between ownership and control. As Stephen Hicks summarises:

What do entrepreneurs want most: wealth or control? Professor Noam Wasserman, of the Entrepreneurial Management unit at Harvard Business School, looks at some of the difficult choices entrepreneurs make.

Read Wasserman's paper here.


  1. Considering how determined CPP is upon cocking their leg on our biggest tree, it would appear that little ol' NZ is either sitting on a gold mine of wealth, (which has yet to be uncovered by the current CEO) or that, control is exactly what this take over is all about.
    (Personally, I consider that the latter to be the case)

    Which ever leg is being lifted, one thing is for certain. The grossly paid procurement boys have severely under-estimated this jobby.

  2. "cocking their leg on our biggest tree..."

    This would be your way of describing offering shareholders over the odds for their shares?

    PS: What's with the "our," white man?

  3. I think most entrepreneurs are seeking both control and a good investment.

    "..control is very important.. as Sumner Redstone of Viacom said in an interview once.

    This whole Auckland Airport debacle has left a bad taste in my mouth, really made me question NZ and NZers..(although I am getting over it now lol)..and a lot of provincial halfwits need to be quite ashamed of themselves.

    This is another one of those "So what?" situations.

    A Canadian Pension fund owns Auckland Airport...well, so what?

    A British business tycoon (or Canadian pop star) has bought a High Country what?

    A [write a Nationality here] Businessman has bought [write an asset here] ...ummmm, so what?

  4. And a Saudi Arabian bought a large tract of the Coromandel a few years ago. The land has since been improved and sold back to New Zealanders. Which should meet with the approval of the racist RR.

    Nigras like capitalism just as much as the rest of us. And Islam is compatible with capitalism just like Christianity is.

  5. Interesting to note that Emirates have announced plans to operate an A380 (super jumbo) between Auckland & Sydney.

    Middle of last year, Dubai Aerospace Enterprise (UAE - Emirates owner) made a bid for AIAL. "Merger documents revealed that DAE would use "reasonable endeavours" to create new routes and services from Auckland for Emirates Airline."

    Note that MacQuarie (owned by UAE - who stood in line after the initial DPW bid failed) has a chunk of shares as well as their "close" associates CPP.

  6. "Interesting to note that Emirates have announced plans to operate an A380 (super jumbo) between Auckland & Sydney."

    Interesting to speculate how Dubai Aerospace could have transformed Auckland into a major South Pacific trave hub -- if, that is, xenophobia hadn't killed off their bid.

  7. Yes, Peter, that was their objective, to the great benefit of the NZ economy.

    So the next time provincial tourist industry operators (who were shocked and appalled at the idea of selling assets to foreigners) complain about a slow season...they have only themselves to blame.

    Similarly the Government complaining about a drop in revenues...only themselves to blame that an extra million tourists are not here chipping in GST payments to put the Govt accounts back in surplus.


    Gosh...the hypocrisy in this Country really annoys me at times

  8. I will not sanction my enemy whose values are antagonistic to my own.

  9. Oh fair enough, Rebel, it is something you feel strongly about, and each to their own.

    I spend my afternoons dealing with foreigners, in 3 different countries, conducting business and making profits.

    It works very well in a business sense but as I said at a drinkies session at Peter's Castle last week, conducting business is one thing but "..I would not want my daughter marrying one of these chaps.." (so to speak)..and there is no one more 'suspicious' of Sydney wide boys and anally retentive Singaporeans, and deceitful Hong Kong traders pretending they cannot speak English when they are stuck with a losing trade...than me!

    People should be free to erect unofficial barriers with people they seek not to associate with, should they so desire.

    However, it is short sighted not to engage in 'Global Business' when there is so much money to be made.

  10. "I will not sanction my enemy whose values are antagonistic to my own."

    Which is great, but irrelevant to any discussion concerning Canadian Pensioners or Emirates since both are not our enemies.

  11. "..I would not want my daughter marrying one of these chaps.."

    But you'd do business with them?

    "irrelevant to any discussion concerning Canadian Pensioners or Emirates since both are not our enemies."

    [Bilateral ties between the U.A.E. and Canada is poised to receive a greater boost following a recent flurry of STRATEGIC alliances between the business communities of the two countries]

    Go to bed with Islam Oswald, the Canadians already have, you can bow your head to the tannoy prayer to Allah prior to take off. Just remember that your airline ticket & the airport revenue you are so keen to dish out, will be contributing to the advancement of islamic owned (global port) monopoly.

    As for me, I'll be looking for a boat.

    And of course it is an islamic requirement to pay 20% tax on profits, which is transferred to other muslims for the promotion of islam, sometimes paid to various muslim charities such as this one.
    About half of the $250,000 spent on the attacks was wired to al-Qaeda terrorists in the United States from Dubai banks"

    This is not an anti-capitalism issue.

  12. RR said : This is not an anti-capitalism issue.

    RR, first you opposed selling the airport on the basis that it is a national interest, ie, no to any foreign ownership, be it Canadian, British, American, UAE, etc...

    Second, you now changed your tactic to oppose the sale on the basis of the buyer being tied or connected to Islam.

    That definitely categorises you as an idiot. Try and have some fuck'n reason argument and stop using your emotional bullshit to muddy the topic about the CPP bidding for shares in the air port.

  13. Rebel Radius

    As much as I do not agree with religious beliefs, I am not in agreement with your comments regarding foreigners. There are a number of seperate issues here and you seem to be in the habit of mixing them all up. Perhaps it suits your purposes to do this (which would make you a dishonest contributor) or perhaps it is a matter of that's your pattern of thought ( which makes you irrational, illogical and foolish), nevertheles it remains wrong.

    You seriously need to drop the empotionalism and look to the facts. Here are eamples:

    1/. Forget about using mushy terms like "our's". You do not speak for me or for anyone else. It is not your airport. It belongs to those persons who have and control the shares. You may well claim that as a ratepayer of one or other City Council you have an ownership of the airport but that is a fiction. You have no say and no control, hence it is not your property at all. The City Council may have taken money from you to get the shares but they do not answer to you for their actions and decisions. Bureaucrats do what they decide. You have utterly no power over them at all.

    2/. It is not necessary to require someone to become a member of your family by marriage in order to do business with them. Your confusion on this matter is startling.

    3/. The fact that a person is the folower of a wonky religion or identifies himself as such does not mean he is an evil person- misguided perhaps, possibly evil but not necessarily so.

    4/. Not all foreigners are bad people involved in a global plot to destroy or steal that which you value.

    5/. What you value and how you value it may be misguided. YOu need to think on this some.

    And that'll do for now.

    You need to do some serious re-evauation of your ideas. Go think some.


  14. The strategic objective of the Brotherhood in America is clear:

    "The Ikhwan [The Muslim Brotherhood's name for itself] must understand that their work in America is a kind of grand Jihad in eliminating and destroying the Western civilization from within and ‘sabotaging' its miserable house by their hands and the hands of the believers so that it is eliminated and Allah's religion is made victorious over all other religions."

    Plan for Genocide (pdf)

  15. The Risky Business Of Islamic Finance

    By INVESTOR'S BUSINESS DAILY February 27, 2008

    Islamofascism: Shariah banking has come into vogue in the West, as even cash-strapped U.S. banks try to attract free-flowing Arab petrodollars. But it poses major risks. Wall Street beware.

    Wall Street is jumping into this hot new market oblivious to the risks not just to the bottom line, but to national security. It knows little about Shariah law and is turning to consultants to create "ethical" products to sell.

    Lost in the hype over these Muslim-friendly funds is that they must "purify" their returns by transferring at least 3% into Islamic charities, many of which funnel funds to terrorists. So the Street may unwittingly be helping the evildoers launder blood money.

    Shariah law obligates that a sizable portion of zakat, or giving — one of the pillars of Islam — go to support jihad. So many of the purification donations generated from Shariah finance could wind up in the hands of our enemy.

    Wall Street also knows little about who's advising these funds. Each has to hire Muslim scholars to bless the investments.

    The Spectator - Melanie Phillips

    Shariah-compliant finance involves investments and other transactions that have been structured to conform with the orthodox teachings of Islamic law…

    Clifford Chance has advised Project Blue (Guernsey) Limited in the acquisition and financing of Chelsea Barracks. Chelsea Barracks, situated in the City of Westminster, is the most valuable development site purchase in UK history. The purchase was completed on 31 January 2008 for a price of £959 million, with the payment split evenly over five years. The Islamic financing was for an amount in the region of £1 billion and is believed to be the largest Islamic financing of UK land.

    Project Blue (Guernsey) Limited is majority owned by Qatari Diar, with investment from CPC Group, a Guernsey based Development Company owned by Christian Candy. It has appointed Candy & Candy as development managers and interior designers for the proposed residential scheme for the site. Clifford Chance real estate partner Mark Payne comments, ‘This extraordinary site continues to set the bar for acquisition and residential development. Its many fascinating aspects now include one of the most complex and innovative financings ever seen in the UK. We are breaking new ground by creating and implementing an Islamic financing on this scale on a major development site in the UK. It was a tremendous team effort with a Clifford Chance real estate team combining market leading expertise in real estate, finance and tax…The site was sold by the Ministry of Defence advised by Philip Page of Michelmores LLP. The banks who underwrote the financing were Masraf Al Rayan, HSBC Amanah, BNP Paribas, Calyon Credit Agricole and Qatar National Bank, advised by a team from Norton Rose led by Anthony Pallett and Lucy Wolley Dod.

    The Prime Minister has said Britain must become the global centre of Islamic banking. More and more public companies are being taken over by Islamic interests; we now have ‘sharia-compliant’ mortgages, and the Treasury is moving towards a system of Islamic bonds. The government seems completely unaware however that sharia banking comes with a devastating IOU—the Islamisation of all those who use it.

  16. "These funds offer little transparency. They fail to disclose either the radical ties of the scholars who are advising and running them or the tenets that dictate the structuring of the investments.

    The prospectuses explain simply that the investments are ‘ethical’ or ‘socially acceptable,’ when in fact they're grounded in a religious doctrine that threatens America and the West.

    The main purpose of Shariah law is to promote Islam as the only legitimate governing system and to help establish its rule worldwide.

    Shariah-compliant finance is a means to that end. Ignoring in a time of war the moral hazards associated with such financial products, and treating them as if they were as benign and secular as any other, may be the height of corporate recklessness."

  17. Rebel Radius

    ".these funds offer little transparancy..." and yet it appears you are claiming to know everything about them. Rrrrrright.

    A person who owns property (such as airport shares) can sell that property (airport shares) to whomever he or she likes. It has nothing to do with the likes of you. It is none of your business.

    The purchaser of the shares can do with them whatever he or she decides. They can hold them or sell them in turn. Once again, none of your business.

    Should the owner of property commit a crime (an initiation of force, fraud or coercion against another), then it is appropriate to take sanction against them. For example, there is nothing wrong with a man buying a gun, even if he is the believer in a crackpot religion. The gun is his so long as he does not use the gun to initiate force against anyone else. Should he take the gun across the road and attack the shopkeeper (say), then it is appropriate for others (including the shopkeeper) to take active sanction and apply retributive force against him. Obviously they will be taking his gun away from him and (should he survive) ensuring he never gets another gun in the future.

    What this means is that should it be proven that the owners of the airport commit IOF against other people, then it would be likely that the airport shares would be removed from their control and redistributed elsewhere. It matters not whether they are foreigners or religos. What maters is how they have acted.

    Of course, proof requires more than mere accusation.

    In the end, the airport isn't going to be removed off-shore to some far off locale (in little boxes as a previous contributor to the blog indicated). Airport is staying right about where it is. Immobile.

    Once again, your hatred of foreigners is misplaced. Similarly, a blind fear of religious people is irrational. there is no need to be paranoid.


  18. LGM, even if they did take the airport offshore ..(!?!?)..there is nothing to stop someone else creating a 'new' Auckland airport on the vacant site, to be called the "Ignorant Working Class Peasant Airport, So There!"

    I think there are many, many people who need to attend the Reisman Lectures on a Sunday to 'cure' them.

  19. Islam is not democratic and can never be democratic. There is no separation between mosque and state, islam is fascist. Yet people like yourselves (the Neville Chamberlain's of this world) would prostitute your (principles) to trade with them.

    NZ's major port is to be sold off to a strategic business ally of an Islamic country where you are NOT permitted to do the same.


    "This is the First draft of the law that will be implemented when it is published in the Court gazette in the nearest future.

    Law No.7 of 2006 stipulates that freehold is limited to UAE and GCC citizens and companies wholly owned by them, as well as public shareholding companies. The law also stipulates that upon approval of Dubai's Ruler, non-UAE nationals may be given the right to own properties in SOME parts of Dubai. The so-called freehold areas of Dubai that would be available for expatriates to own with ruler's approval will be later designated."

  20. Why on earth would anyone want to own property or live in Dubai?!?!

    Try to visualise the following: ...Westport. 35 degree heat. Sand. Tall Buildings. Embarrassing displays of vulgarity from people who wish to Allah they were White.

    That is what Dubai is and the locals are welcome to it!

  21. RR

    Are you really that obtuse? Or is it you can't abide admitting when you are wrtong?

    Little man, get this into your mucked up wee mind; just because someone professes to folow a weird religion, that does not preclude me from dealing with them. Should you not want to do business with others then that is your decision. In this case (airport shares) the decision is made for you. As you do not own any of the property in question there is no need for you to trouble your poor bigoted mind on it. It is not your business. You are simply an uninvolved busybody. Really, you should sit down and have a nice warm cup of shut the fuck up. You are a contemptible blowhard.


  22. Rebel Radius, do you own shares in Auckland Airport? If you don't , then shut the fuck up. It is not your decision, nor the government's decision to dictate to shareholders whether to sell or not to sell.


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