Greed drives disaster?

Matthew Denholm in The Australian this morning records claims, from trapped miners and others, that the Beaconsfield mining disaster was driven by the goldminer’s rush to repay its debts to Macquarie Bank. Recall that Allstate Explorations, in administration, owned 55% of the mine but, in a 2002 deal, Macquarie Bank bought the $77 million debt of Allstate for $300,000. Macquarie has already reaped more than $27 million from the mine.

I posted on the nature of the Macquarie deal a year ago.

I maintain my view that a book-length treatment of this whole saga should be written. Maybe, it could be used as a case study in our business schools – how a merchant bank adds social value. Maybe, too, other lessons can be learned.

Of course, I hope that chief value-adder Allan Moss doesn’t choke on his recent $33 million annual reward from Macquarie. I assume that the deal Macquarie did with Allstate illustrates the financial expertise necessary to gain such rewards.

A Tasmanian inquiry into the tragedy is reporting in a few weeks. Let's hope those responsible pay.