1 00:00:05,160 --> 00:00:08,039 Speaker 1: This is off the Flux. I'm Brett and our justin a. 2 00:00:08,119 --> 00:00:10,559 Speaker 1: It's Wednesday, the twenty eighth of Bay Jazzy Boy. There 3 00:00:10,640 --> 00:00:13,000 Speaker 1: is a race for ossies to get into the property market. 4 00:00:13,039 --> 00:00:16,079 Speaker 1: Pre approvals through mortgage brokers increase twenty four percent in 5 00:00:16,239 --> 00:00:19,200 Speaker 1: March after the first cash rate cut this year according 6 00:00:19,200 --> 00:00:22,280 Speaker 1: to Equifax, and with another rate cut recently, you can 7 00:00:22,320 --> 00:00:25,320 Speaker 1: only imagine even more Ozzie's trying to get in. What's 8 00:00:25,320 --> 00:00:27,480 Speaker 1: of fomo going on? By Man Speaking of Fomo. 9 00:00:27,320 --> 00:00:29,840 Speaker 2: Flux fan, we have done a deep dive into the 10 00:00:29,840 --> 00:00:32,800 Speaker 2: property market in Australia how rate cuts and the government's 11 00:00:32,800 --> 00:00:35,400 Speaker 2: five percent deposit could impact the property prices over the 12 00:00:35,440 --> 00:00:37,960 Speaker 2: next twelve months, and it begins firing up. So if 13 00:00:37,960 --> 00:00:40,240 Speaker 2: you want to learn more about what the experts think 14 00:00:40,280 --> 00:00:42,400 Speaker 2: will happen to the property market in twenty twenty five, 15 00:00:42,520 --> 00:00:44,479 Speaker 2: make sure to download the Flux out and check out 16 00:00:44,520 --> 00:00:48,600 Speaker 2: our latest articles Three Monstrous stories Today Juzzy boy, let's 17 00:00:48,640 --> 00:00:51,960 Speaker 2: do it for our first Wise Tech, the ASX listed 18 00:00:52,080 --> 00:00:55,760 Speaker 2: logistics Beast, has announced a two point one billion US 19 00:00:55,760 --> 00:00:58,720 Speaker 2: dollar acquisition, its biggest yet by a mile. 20 00:00:58,800 --> 00:01:01,279 Speaker 1: Wise Tech making acquisitions left right and center. B Man 21 00:01:01,360 --> 00:01:03,040 Speaker 1: so tell me what's going on here? All right? So, 22 00:01:03,120 --> 00:01:06,760 Speaker 1: wise Tech Global is the asxisted logistics software company which 23 00:01:06,800 --> 00:01:08,480 Speaker 1: was founded in nineteen ninety four, and. 24 00:01:08,480 --> 00:01:12,000 Speaker 2: It does those unseexy logistics activities like helping with supply 25 00:01:12,160 --> 00:01:17,280 Speaker 2: chain management or customs clearance or forwarding services, real riveting stuff, 26 00:01:17,440 --> 00:01:19,200 Speaker 2: but been man Over the last twelve months, it has 27 00:01:19,280 --> 00:01:21,039 Speaker 2: been a real rocket time for wis Tech. 28 00:01:21,080 --> 00:01:23,440 Speaker 1: Yeah, it's founder, Richard White was accused of bullying as 29 00:01:23,440 --> 00:01:26,560 Speaker 1: well as inappropriate conduct at work. But now wise tech 30 00:01:26,600 --> 00:01:29,720 Speaker 1: has made its biggest acquisition of all time. Yeah, it's 31 00:01:29,760 --> 00:01:33,440 Speaker 1: acquired a US PUBLICULASTD supply chain management company named E 32 00:01:33,560 --> 00:01:35,040 Speaker 1: two Open and E two Open. 33 00:01:35,080 --> 00:01:37,720 Speaker 2: It's also had a testy couple of years. Its market 34 00:01:37,760 --> 00:01:40,480 Speaker 2: cap actually fell lower than its total debt. 35 00:01:40,440 --> 00:01:42,800 Speaker 1: But that hasn't stopped wis Tech swooping in with a 36 00:01:42,840 --> 00:01:45,600 Speaker 1: two point one billion US dollar acquisition. So it's a 37 00:01:45,600 --> 00:01:49,559 Speaker 1: big step up in wis Tech's aggressive acquisition strategy, especially 38 00:01:49,680 --> 00:01:52,160 Speaker 1: with so much going on internally at wis Tech right now. 39 00:01:52,400 --> 00:01:54,559 Speaker 1: So what is the key learning here? Well, small deals 40 00:01:54,600 --> 00:01:57,720 Speaker 1: can glide under the radar. Big ones demand a spotlight. 41 00:01:57,800 --> 00:02:00,240 Speaker 1: Over the past decade, wise Tech has acquired more than 42 00:02:00,320 --> 00:02:03,600 Speaker 1: fifty five companies, and the man wey Sex mainly funded 43 00:02:03,600 --> 00:02:06,240 Speaker 1: these acquisitions through its profits as well as some smaller 44 00:02:06,280 --> 00:02:09,960 Speaker 1: investments YEAP. In the past, the acquisitions have been mostly 45 00:02:10,000 --> 00:02:13,200 Speaker 1: small to medium businesses across freight and rail and supply 46 00:02:13,280 --> 00:02:16,640 Speaker 1: chaineech and so far, so good on the acquisition train, supposedly. 47 00:02:16,880 --> 00:02:19,400 Speaker 2: Yeah, but but man, this deal is a totally different 48 00:02:19,440 --> 00:02:20,400 Speaker 2: style of acquisition. 49 00:02:20,480 --> 00:02:23,200 Speaker 1: Well, firstly, it's the biggest acquisition wise tech's ever done. 50 00:02:23,240 --> 00:02:26,120 Speaker 1: We're talking three times bigger than any deal before it. 51 00:02:26,200 --> 00:02:29,239 Speaker 1: And secondly, they're taken on three billion US dollars in 52 00:02:29,360 --> 00:02:31,680 Speaker 1: new debt just to fund the deal, and that means 53 00:02:31,720 --> 00:02:34,720 Speaker 1: a big shift in risk profile because they are not 54 00:02:34,800 --> 00:02:38,400 Speaker 1: only paying for the acquisition but also interest repayments on debt. So, Man, 55 00:02:38,480 --> 00:02:41,160 Speaker 1: when companies go all in the stakes get a whole 56 00:02:41,160 --> 00:02:44,160 Speaker 1: lot higher. And with the spotlight on Wistech for other 57 00:02:44,200 --> 00:02:46,760 Speaker 1: reasons at the moment, it will need to prove that 58 00:02:46,840 --> 00:02:49,600 Speaker 1: this acquisition was absolutely worth it. Yeah. 59 00:02:49,639 --> 00:02:53,360 Speaker 2: For our second story, health Scope, Australia's second largest private 60 00:02:53,400 --> 00:02:56,960 Speaker 2: hospital group, has fallen into administration after its struggled to 61 00:02:57,000 --> 00:02:58,520 Speaker 2: repay its whopping debts. 62 00:02:58,680 --> 00:03:01,359 Speaker 1: Horrible time for healthco Jazzy boy, what is going on here? 63 00:03:01,440 --> 00:03:04,240 Speaker 2: Bit abautground b Man. Healthscope is one of Australia's biggest 64 00:03:04,240 --> 00:03:08,760 Speaker 2: private hospital operators. We're talking over thirty nine hospitals across Australia. 65 00:03:08,320 --> 00:03:10,440 Speaker 1: And over nineteen thousand star And. 66 00:03:10,360 --> 00:03:13,120 Speaker 2: While Healthscope was previously listed on the ASX, it was 67 00:03:13,160 --> 00:03:17,000 Speaker 2: acquired by private equity giant Brookfield in twenty nineteen. 68 00:03:16,639 --> 00:03:19,000 Speaker 1: For or lazy four point one billion dollars. But now 69 00:03:19,040 --> 00:03:22,120 Speaker 1: be Man health Scope has gone into receivership after its 70 00:03:22,160 --> 00:03:25,040 Speaker 1: struggle to repay its debt and keep its finance as 71 00:03:25,080 --> 00:03:27,840 Speaker 1: a fault now, Dazi boy. It blamed three key issues. 72 00:03:27,880 --> 00:03:29,799 Speaker 1: What was the first one? It was carrying too much debt. 73 00:03:29,800 --> 00:03:32,200 Speaker 1: We're talking at one point four billion bucks in debt. 74 00:03:32,240 --> 00:03:35,000 Speaker 1: It was paying huge rents on the hospital premises. 75 00:03:35,200 --> 00:03:37,760 Speaker 2: And it claims that the amount of private health insurance 76 00:03:37,760 --> 00:03:40,000 Speaker 2: pay to private hospital is just too low. 77 00:03:40,160 --> 00:03:43,119 Speaker 1: Yeap. Next minute, health Scope appointed receivers to sell off 78 00:03:43,160 --> 00:03:45,720 Speaker 1: the hospitals and Jazi boy, the Federal government has said 79 00:03:45,760 --> 00:03:50,240 Speaker 1: that a bailout is not going to happen under any conditions, particularly. 80 00:03:49,680 --> 00:03:52,360 Speaker 2: Because health Scope is a private hospital owned by a 81 00:03:52,400 --> 00:03:53,760 Speaker 2: private equity giant. 82 00:03:53,840 --> 00:03:56,280 Speaker 1: But with thousands of patients in the hospitals right now. 83 00:03:56,360 --> 00:03:59,200 Speaker 1: They've also got to stay open. So what is the 84 00:03:59,280 --> 00:04:02,560 Speaker 1: key learning here? When private equity enters sectors like healthcare 85 00:04:02,680 --> 00:04:05,840 Speaker 1: or education or aged care, things can get a bit messy. 86 00:04:05,920 --> 00:04:07,680 Speaker 2: Yeah, because, b man, we know that the goal of 87 00:04:07,720 --> 00:04:11,320 Speaker 2: private equity is about maximizing financial returns. 88 00:04:10,920 --> 00:04:13,920 Speaker 1: Yeap companies like Brookfield By companies often with a lot 89 00:04:13,960 --> 00:04:16,560 Speaker 1: of debt, and then try to make them more profitable. 90 00:04:16,040 --> 00:04:20,080 Speaker 2: Which would be through cost cutting or price rises or restructuring, and. 91 00:04:20,040 --> 00:04:22,000 Speaker 1: Then they aim to sell the companies for a gain. 92 00:04:22,040 --> 00:04:24,640 Speaker 2: But when you apply that profit focused model to healthcare, 93 00:04:24,760 --> 00:04:26,560 Speaker 2: things can start to unravel. 94 00:04:26,200 --> 00:04:29,960 Speaker 1: Because healthcare should be focused primarily on better patient outcomes. 95 00:04:29,960 --> 00:04:30,520 Speaker 1: But be maned. 96 00:04:30,560 --> 00:04:33,000 Speaker 2: With up to ten companies already sending offers to the 97 00:04:33,040 --> 00:04:36,159 Speaker 2: receivers for health Scope, here's hoping the hospitals can continue 98 00:04:36,200 --> 00:04:38,160 Speaker 2: a smooth operation with its new owners. 99 00:04:38,200 --> 00:04:41,640 Speaker 1: For our third and final story, Arnots is writing a 100 00:04:41,680 --> 00:04:44,760 Speaker 1: new wave of love for its timtams with its plans 101 00:04:44,800 --> 00:04:46,800 Speaker 1: to expand aggressively overseas. 102 00:04:47,160 --> 00:04:49,120 Speaker 2: I know you'd be saying, God bless those gluten free 103 00:04:49,120 --> 00:04:51,560 Speaker 2: tymtams right now, be man totally me more. 104 00:04:51,400 --> 00:04:53,479 Speaker 1: Well, Arnots is the one hundred and sixty year old 105 00:04:53,480 --> 00:04:56,680 Speaker 1: Aussie food icon and the local market leader when it 106 00:04:56,720 --> 00:04:57,880 Speaker 1: comes to biscuits. 107 00:04:57,960 --> 00:05:00,600 Speaker 2: Yep, it's the maker of all your childhood and adulthood 108 00:05:00,600 --> 00:05:04,560 Speaker 2: favorites like your shapes, your tiny teddies, your Scotch fingers. 109 00:05:04,760 --> 00:05:07,760 Speaker 1: Heaven bless those pizza shapes. May I add, but b Man, 110 00:05:07,960 --> 00:05:10,320 Speaker 1: Tim Tams are really having a moment right now. I 111 00:05:10,400 --> 00:05:12,400 Speaker 1: was thinking that they are always having a moment. To 112 00:05:12,400 --> 00:05:14,720 Speaker 1: be honest, juzzy boy, that's true. But get this, be Man. 113 00:05:14,800 --> 00:05:17,400 Speaker 1: Tim Tams now make up forty one percent of the 114 00:05:17,480 --> 00:05:20,720 Speaker 1: chocolate biscuit market in Australia. Wow, It's market share grow 115 00:05:20,800 --> 00:05:23,479 Speaker 1: by five point eight percent in the past year alone. 116 00:05:23,279 --> 00:05:26,960 Speaker 2: And now Art has announced plans for international domination with 117 00:05:27,040 --> 00:05:28,520 Speaker 2: its trusty tim Tams. 118 00:05:28,640 --> 00:05:30,960 Speaker 1: Yeah, it's planning to grow it's Timtam business in the UK, 119 00:05:31,200 --> 00:05:33,720 Speaker 1: the US, Canada and even Japan and b Man. 120 00:05:33,760 --> 00:05:36,440 Speaker 2: It's also been pushing brand extensions with other brands in 121 00:05:36,480 --> 00:05:39,320 Speaker 2: the Art stable like Jats, Tim Tams. 122 00:05:39,520 --> 00:05:42,800 Speaker 1: And brand extensions with its gluten free Range two which 123 00:05:42,880 --> 00:05:45,520 Speaker 1: is killing it and I one hundred percent endorse. So 124 00:05:45,680 --> 00:05:48,279 Speaker 1: what is the key learning here? Product line extensions are 125 00:05:48,279 --> 00:05:51,480 Speaker 1: when a company introduces new products within an existing brand. 126 00:05:51,600 --> 00:05:54,680 Speaker 2: The goal is to teach new customers about existing products 127 00:05:54,680 --> 00:05:56,919 Speaker 2: and cater to their shifting preferences. 128 00:05:57,000 --> 00:05:59,839 Speaker 1: The benefit of product line extensions is they reduce the 129 00:06:00,120 --> 00:06:03,719 Speaker 1: risk typically associated with new product launchers. Instead of starting 130 00:06:03,720 --> 00:06:07,719 Speaker 1: from scratch, brands piggyback off other familiar names like Timtams 131 00:06:07,880 --> 00:06:10,960 Speaker 1: or shapes and they just adjust the flavor or the format. 132 00:06:11,080 --> 00:06:13,680 Speaker 1: Take the Artt's gluten free range, be man It leveraged 133 00:06:13,680 --> 00:06:16,800 Speaker 1: the existing products in the Artet's range and change the 134 00:06:16,920 --> 00:06:20,919 Speaker 1: ingredients to make them more appealing to an underappreciated demographic. 135 00:06:21,120 --> 00:06:23,839 Speaker 1: In fact, Arnest's gluten Free Range is driving about eighty 136 00:06:23,839 --> 00:06:26,640 Speaker 1: percent of the growth in the gluten free biscuit market. 137 00:06:26,680 --> 00:06:29,320 Speaker 1: And what a market it is. So now, me man Or, 138 00:06:29,320 --> 00:06:32,840 Speaker 1: We're busy perfecting the Tim tamslamb Ardits is quietly taking 139 00:06:32,880 --> 00:06:35,040 Speaker 1: over the world and I'm here for it. Whatsam prayer 140 00:06:35,040 --> 00:06:37,440 Speaker 1: proval is going through the room, cash rate going down, 141 00:06:37,680 --> 00:06:40,120 Speaker 1: clearance rates going up. It's all happening in the property 142 00:06:40,120 --> 00:06:42,479 Speaker 1: market in Australia right now. We cover it all in 143 00:06:42,520 --> 00:06:45,520 Speaker 1: the Flux app with a deep dive into expert analysis 144 00:06:45,520 --> 00:06:47,400 Speaker 1: and predictions of what's going to happen to the housing 145 00:06:47,440 --> 00:06:49,040 Speaker 1: market in twenty twenty five, So if you want to 146 00:06:49,080 --> 00:06:51,080 Speaker 1: learn more, make sure to download the Flux app and 147 00:06:51,160 --> 00:06:53,200 Speaker 1: check it out. Thanks for listening, and we'll see you 148 00:06:53,320 --> 00:06:54,120 Speaker 1: on Friday.