Transfield Services

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For the company separated from Transfield Services in 1997, see Tenix.
Transfield Services Ltd.
Type Publicly listed corporation
Industry Infrastructure maintenance services
Founded 2001 (Listing on ASX)
Founder(s) Franco Belgiorno-Nettis AC
Headquarters North Sydney, Australia
Area served Australia, Canada, Chile, New Caledonia, Philippines, India, New Zealand, United Arab Emirates, Qatar, United States
Key people Diane Smith-Gander (Chairman)
Graeme Hunt (MD & CEO)
Vince Nicoletti (CFO)
Services Operations, maintenance, and asset and project management services
Revenue Increase A$3.208 billion (2011)[1]
Operating income Increase A$3.295 billion[1]
Net income Decrease (A$20 million)[1]
Total assets Increase A$2.267 billion[1]
Total equity Increase A$1.124 billion[1]
Employees 19,000
Subsidiaries APP, Broadspectrum, Easternwell, ICD.
Website http://www.transfieldservices.com/

Transfield Services Ltd. (ASXTSE) is an Australian publicly listed corporation providing operations and maintenance, asset management, project and capital management outsourcing and infrastructure development services to the resources and industrial, infrastructure services and property and facilities management sectors. The Company operates in Australia and New Zealand, Canada, the United States, Chile, Brunei, New Caledonia, and The Philippines.

Overview[edit]

Transfield Services operates across diverse industries, including property and facilities management, defence, transport (including road, rail and public transport), utilities (including water, power, and telecommunications), and mining and process, hydrocarbons. Transfield Services's clients include major national and international companies, as well as all levels of government.[2]

History[edit]

The origins of Transfield Services Ltd. can be traced to 1956 when Transfield Pty. Ltd. was founded in Australia by an Italian born immigrant electrical engineer, Franco Belgiorno-Nettis, who was joined soon after by a former colleague from EPT (Electric Power Transmission,an off-shoot of Milan-based Societa' Anonima Elettrificazione, which was constructing powerlines), Carlo Salteri. The Company's logo, designed by Belgiorno-Nettis, reflects its electricity industry origins; it is intended to represent a high-voltage transmission tower, with an accompanying red electrical spark.

Together Saltieri and Belgiorno-Nettis built Transfield into one of Australia's most successful companies focused on major engineering projects, such as bridges, tunnels, dams, hydro-electric and coal power stations, oil rigs, concert halls, sugar mills and power lines. Included in their list of achievements are the construction of the Gateway Bridge in Brisbane and the Sydney Harbour Tunnel. By the early 1980s, Transfield had in excess of 3,000 employees and an annual turnover of A$350 million; and within five years grew to be the biggest engineering firm in south-east Asia. The Company acquired the Williamstown Dockyard in Melbourne and, in 1989 after winning a A$6 billion contract to build ten ANZAC class frigates for the Australian and New Zealand governments, the largest defence contract in Australia at the time.[3][4] When visiting Australia in 1986 Pope John Paul II toured the Transfield factory located at Seven Hills.[5]

The Company established a naval shipbuilding capability in Australia first known as AMECON, then as Transfield Defence Systems,with the successful construction of two FFG7 - Oliver Hazard Perry class frigates for the Royal Australian Navy. It was later awarded the Anzac Ship Project contract,[4] for 10 Anzac class frigates, eight for the Royal Australian Navy and two for the Royal New Zealand Navy.

In 1989, Salteri and Belgiorno-Nettis stood down as joint managing directors of Transfield Holdings (as the company was then named) in favour of their eldest sons, Paul Salteri and Marco Belgiorno-Zegna.[6] However, in a dispute between Salteri and Belgiorno-Nettis in 1995, the differences between the two families became irreconcillable and Transfield, then valued at A$733.2 million was split in two.[3] The Belgiorno-Nettis family kept the name Transfield, having earlier established Transfield Holdings’ Operations and Maintenance division in 1993 at Mobil Altona in Victoria.

Separation of Holdings and Services businesses[edit]

In 2001, the Operations and Maintenance division was separated and listed on the Australian Securities Exchange as Transfield Services Ltd.[7]

As a private investment and development company, Transfield Holdings retained a minority shareholding in Transfield Services. Its joint managing directors, Guido and Luca Belgiorno-Nettis, sons of Franco, were both directors on the Board of Transfield Services Ltd., until 2012. The two businesses have similar logos and are often confused, but are separate legal entities. Services licences it's brand from Holdings.

In June 2007, Transfield Services Infrastructure Fund was floated, comprising seven former Transfield Services assets; and later that year, the company acquired four wind farms.[7]

In April 2009, Transfield Services announced the appointment of Dr Peter Goode as managing director and chief executive officer, succeeding Peter Watson, who had been CEO since the company was listed on the ASX. Goode, born in South Australia, was a former senior executive with US–based oilfield services multinational Schlumberger, and the former Group President and CEO of Vetco. He stated that his strategy was to move Transfield Services into higher margin sectors, particularly providing maintenance services to the oil and gas sector.[8]

As part of this strategy Transfield Services acquired privately owned Australian well-servicing business Easternwell in December 2010 for A$575 million. Easternwell provides services to the mining, oil and gas and infrastructure sectors in Queensland, South Australia and Western Australia.[9][10]

In July 2011 Transfield Services sold its North American based facilities management business USM to Emcor for US$255 million (A$240m),[11] and also announced the sell down of 80 percent of its share in the Transfield Services Infrastructure Fund to Ratchaburi Australia, a subsidiary of Thai company Ratchaburi Electricity General Holding PLC. In announcing the sale, Transfield Services Infrastructure Fund said it would book an A$12.2 million loss on its investment.[12][13]

The retirement of the Belgiorno-Nettis brothers from the Board, the sons of the company's founder, took place in early August 2012 - with both stating they wanted to concentrate on philanthropic and community interests. The number of Transfield Holdings seats on the Board was reduced to one, with Roy McElvie a former Private Equity and Investment manager being appointed in the brothers' place.

McElvie has since resigned as Chief Executive Officer of Transfield Holdings, but retains a seat on the Transfield Services Board as a Non-Executive Director. As of November 2013 he no longer holds the status of Transfield Holdings nominee.

On 29 August 2012, concurrent with announcing its full year results, the company also disclosed that Peter Goode had resigned as MD and CEO to take up a position with Arle Capital Partners Ltd, a London based private equity firm, effective 30 September. Transfield Service's board of directors announced the appointment of independent board director Graeme Hunt as Interim MD and CEO, and later confirmed his appointment at the company's annual meeting on 1 November.

Current operations[edit]

Hunt is a former BHP Chief Executive of Iron Ore, and was also Chief Executive Officer of Lihir Gold. On confimration of his Managing Director role at Transfield Services, he signalled a review of the businesses portfolio of operations, announcing at the company's half year results on 26 February 2013 that it would divest the Marine Geotechnical and Mining Exploration Divisions of the Easternwell business, as well as the majority of the company's Middle East and Asia operations.

On 2 September 2013, the company announced that Chairman Tony Shepherd would not be seeking re-election and independent Director Diane Smith-Gander had been elected to lead the Board, effective from 24 October.

The company announced it was exiting the New Zealand hydrocarbons market on 22 October 2013 and selling its 50 percent share in its Transfield Worley joint venture for $30 million to current joint venture partner WorleyParsons. Transfield Services said money from the sale would be used to pay down debt.[14]

In January 2014 in a statement to the Australian Stock Exchange, Transfield Services announced it would be responsible for support and welfare services at the Australian Department of Immigration and Border Protection's facilities on the islands of Nauru and Manus, under a A$1.22 billion, 20 month contract. Transfield Services assumed control of the Manus facility on 28 March 2014 and is responsible for managing both facilities, catering, maintenance, recreation and educational activities. It subcontracts security services at both sites to Wilson Security.

Controversy[edit]

The appointment of Transfield Services to run Manus and Nauru was criticised by refugee advocacy groups on the grounds that duty to shareholders conflicted with provision of welfare services.[15] In February 2014 this led to calls for an artist and audience boycott of the 19th Biennale of Sydney, which Transfield Services supports through the Transfield Foundation, providing approximately six per cent of the Biennale's total funding.[16] Following protests and widespread criticism on social media, Executive Director of Transfield Holdings Luca Belgiono-Nettis subsequently resigned from his position as Chairman of the Biennale Board, and the Biennale severed its 41 year sponsorship relationship with Transfield Holdings.[17] This decision itself has led to debate, with boycott organisers saying the boycott was successful, while their opponents claimed it had jeopardised the future of corporates and businesses funding the arts in Australia.[18]

Philanthropy[edit]

Transfield has had a longstanding commitment to the arts in the community. The company's involvement began when Franco Belgiorno-Nettis launched the Transfield Art Prize. Commonly known in art circles as the ‘Transfield’, the prize has become one of Australia’s major annual arts events. Since 1983, Transfield has also supported the Biennale of Sydney; now one of the premier activities in the Australian arts calendar. In the 1990s Transfield began supporting the Australian Chamber Orchestra.[19] Both of these sponsorships have been continued by Transfield Holdings, separate from the Services business. Transfield Holdings and the Belgiorno-Nettis family have also had a long association with the Art Gallery of New South Wales and donated A$4 million in 2007 to enable the creation of the Franco & Amina Belgiorno-Nettis & family Contemporary Galleries.[20]

The Transfield Foundation, a joint venture between Transfield Services and Transfield Holdings, was created in November 2010 and provides philanthropic support for innovation in employment and education, resources management and the arts across Australia.[21]

References[edit]

  1. ^ a b c d e "Preliminary financial accounts" (pdf). Annual Report. Transfield Services Ltd. 2011. p. 4. Retrieved 26 August 2011. 
  2. ^ "About us: Overview". Transfield Services website. 2011. Retrieved 2 August 2011. 
  3. ^ a b FitzSimons, Peter (22 October 2010). "Laying foundations of modern Australia". The Sydney Morning Herald. Retrieved 31 July 2011. 
  4. ^ a b Easrnshaw, Dr Paul (September–October 1997). "The Australian Frigate Project". Australian Defence Force Journal (Australia: Department of Defence) (127). Retrieved 24 April 2009. 
  5. ^ "Carlo Salteri AC". Public notice. Tenix Group. October 2010. Retrieved 31 May 2011. 
  6. ^ "Transfield co-founder Carlo Salteri dies". The Age (Australia). AAP. 13 October 2010. Retrieved 31 July 2011. 
  7. ^ a b "Home grown and growing with Transfield Services" (pdf). Corporate publiscations. Transfield Services. 2008. Retrieved 2 August 2011. 
  8. ^ Goode, Peter (3 May 2010). "Transfield Services Investor Presentation" (pdf). Transfield Services Ltd. Retrieved 26 August 2011. 
  9. ^ Lee, Tracy (26 February 2011). "Easternwell addition drives Transfield Services rally". The Australian. Retrieved 25 August 2011. 
  10. ^ "Transfield snaps up Easternwell for $575m". The Sydney Morning Herald. AAP. 13 December 2010. Retrieved 25 August 2011. 
  11. ^ Lee, Tracy (20 May 2011). "Transfield offloads weak US service arm". The Australian. Retrieved 25 August 2011. 
  12. ^ Kelly, Ross (2 May 2011). "Transfield Services Infrastructure Fund backs offer from Thailand's Ratchaburi". The Australian. Dow Jones Newswires. Retrieved 25 August 2011. 
  13. ^ Robins, Brian; Ker, Peter (18 August 2011). "Transfield's $12.2m Loy Yang hit over carbon tax". The Age. Retrieved 25 August 2011. 
  14. ^ http://www.transfieldservices.com/page/News_Centre/News/News_2013/Transfield_Services_sells_NZ_joint_venture_share/
  15. ^ http://www.theguardian.com/world/2014/feb/03/construction-company-set-to-take-over-salvos-asylum-seeker-welfare-services
  16. ^ http://www.smh.com.au/entertainment/art-and-design/refugee-outrage-threatens-sydney-biennale-sponsorship-20140221-3373k.html
  17. ^ Fortescue, Elizabeth. "Biennale Future in Doubt". Daily Telgraph. Retrieved 12 March 2014. 
  18. ^ Pickard, Nicholas. "Art kicks own goal". Sydney Morning Herald. Retrieved 12 March 2014. 
  19. ^ "Groundbreaking Arts Organisations". Foundation Grants. Transfield Foundation. 2011. Retrieved 2 August 2011. 
  20. ^ "The Belgiorno-Nettis family donate $4 million to support contemporary art at the AGNSW". Art News. Art Gallery of New South Wales. 28 August 2007. Retrieved 2 Augugst 2011. 
  21. ^ "About us". Transfield Foundation. 2014. Retrieved 16 February 2014. 

External links[edit]