1 00:00:00,240 --> 00:00:03,840 Speaker 1: Good morning and welcome to the Daily OS. It's good 2 00:00:03,840 --> 00:00:06,920 Speaker 1: to be back with everybody for another week. In the 3 00:00:06,960 --> 00:00:10,520 Speaker 1: hot seat for the news, I'm joined by Zara Sidler, 4 00:00:10,600 --> 00:00:14,720 Speaker 1: the co founder of The Daily OS and Absolute News Extraordinary. Zara, 5 00:00:14,800 --> 00:00:17,400 Speaker 1: I hope you got some outside time on your weekend 6 00:00:17,440 --> 00:00:20,680 Speaker 1: because it sounds like for much of Eastern Australia weed 7 00:00:20,800 --> 00:00:24,000 Speaker 1: for a very wet week. But today is a really 8 00:00:24,040 --> 00:00:27,760 Speaker 1: big day for a lot of Australians. Zara. Why is 9 00:00:27,800 --> 00:00:28,080 Speaker 1: that so? 10 00:00:28,920 --> 00:00:33,280 Speaker 2: As of today, Australia's borders are officially open with every 11 00:00:33,320 --> 00:00:35,879 Speaker 2: state and territory except for wa though we do know 12 00:00:35,960 --> 00:00:40,639 Speaker 2: that that is coming soon opened to vaccinated international visitors. 13 00:00:40,960 --> 00:00:42,800 Speaker 2: Now we know, of course that the borders have been 14 00:00:42,840 --> 00:00:46,400 Speaker 2: shut for almost two years thanks to COVID nineteen, with 15 00:00:46,520 --> 00:00:49,320 Speaker 2: Prime Minister Scott Morrison saying yesterday that there are one 16 00:00:49,400 --> 00:00:52,320 Speaker 2: point two million people around the world who are quote 17 00:00:52,479 --> 00:00:54,800 Speaker 2: visit up and can come to Australia. 18 00:00:55,400 --> 00:00:59,320 Speaker 1: The Australian Defense Force has accused a Chinese navy vessel 19 00:00:59,320 --> 00:01:03,280 Speaker 1: of shining a lange at an Australian aircraft. So according 20 00:01:03,280 --> 00:01:06,800 Speaker 1: to the ADF, the situation occurred on the seventeenth of February, 21 00:01:06,840 --> 00:01:10,120 Speaker 1: Prime Minister Morrison said on the accusation quote, I can 22 00:01:10,160 --> 00:01:12,960 Speaker 1: see it no other way than an act of intimidation, 23 00:01:13,360 --> 00:01:16,720 Speaker 1: one that is unprovoked, unwarranted, and Australia will never accept 24 00:01:16,920 --> 00:01:18,560 Speaker 1: such acts of intimidation. 25 00:01:19,280 --> 00:01:22,959 Speaker 2: Storm Units has killed at least twelve people after strong 26 00:01:23,040 --> 00:01:27,280 Speaker 2: winds left significant damage over several parts of Europe. Yesterday, 27 00:01:27,319 --> 00:01:29,880 Speaker 2: it was reported that four hundred thousand people in the 28 00:01:29,959 --> 00:01:34,440 Speaker 2: UK had lost power, with cleanups in multiple countries now underway. 29 00:01:34,640 --> 00:01:37,200 Speaker 2: The storm is one of the most damaging in Europe 30 00:01:37,240 --> 00:01:37,800 Speaker 2: in years. 31 00:01:39,040 --> 00:01:42,800 Speaker 1: And today's good news Australia has concluded its most successful 32 00:01:42,840 --> 00:01:45,720 Speaker 1: Winter Olympics of all time, winning four medals overall. That 33 00:01:45,920 --> 00:01:49,760 Speaker 1: was one gold, two silver and one bronze medal. Freestyle 34 00:01:49,760 --> 00:01:53,400 Speaker 1: skier and three time Olympian Sammy Kennedy sim was Australia's 35 00:01:53,440 --> 00:01:56,320 Speaker 1: flag bearer for the closing ceremony. It's not going to 36 00:01:56,360 --> 00:01:59,080 Speaker 1: be that reliable thing on our television screens as it 37 00:01:59,120 --> 00:02:01,560 Speaker 1: has been for the last almost two weeks. We're going 38 00:02:01,600 --> 00:02:08,880 Speaker 1: to have to find something else to watch. Maddie and 39 00:02:08,919 --> 00:02:12,320 Speaker 1: Sophie joined me for a very special Monday episode of 40 00:02:12,400 --> 00:02:15,080 Speaker 1: Your In Good Company meets The Daily ohs, we need 41 00:02:15,120 --> 00:02:17,440 Speaker 1: to bring these guys into breakdown some of the weirder, 42 00:02:17,600 --> 00:02:23,240 Speaker 1: more complex, more jargon field finance stories of the week. Guys, 43 00:02:23,320 --> 00:02:25,960 Speaker 1: it's been a week since the Super Bowl. It's been 44 00:02:26,000 --> 00:02:31,120 Speaker 1: a week since the Avengers lineup of rappers at halftime. 45 00:02:31,320 --> 00:02:33,680 Speaker 1: But I'm interested to talk to you guys about the 46 00:02:33,720 --> 00:02:37,200 Speaker 1: advertising aspects of the Super Bowl, a massive part of 47 00:02:37,320 --> 00:02:40,440 Speaker 1: the day for Americans and everyone around the world. Did 48 00:02:40,480 --> 00:02:44,239 Speaker 1: we see any brands actually get a return on their 49 00:02:44,280 --> 00:02:47,360 Speaker 1: investment and do well out of these ads they paid 50 00:02:47,360 --> 00:02:47,960 Speaker 1: millions for. 51 00:02:48,520 --> 00:02:51,480 Speaker 3: Yes, so it's definitely an interesting one. I've guessed during 52 00:02:51,480 --> 00:02:53,680 Speaker 3: a lot of sports events, people don't really care about 53 00:02:53,720 --> 00:02:56,840 Speaker 3: the commercials. But in terms of the Super Bowl, these 54 00:02:56,880 --> 00:02:59,720 Speaker 3: ads cost a lot of money. They sell for upwards 55 00:02:59,720 --> 00:03:03,600 Speaker 3: of six point five million dollars for thirty seconds, so 56 00:03:03,880 --> 00:03:06,880 Speaker 3: you would hope that they get a little bit of return. 57 00:03:07,160 --> 00:03:08,920 Speaker 3: So yep, they get a bit of return, and six 58 00:03:09,000 --> 00:03:10,959 Speaker 3: point five million dollars seems like a lot of money 59 00:03:11,000 --> 00:03:12,560 Speaker 3: for you and me. I would love to have that 60 00:03:12,639 --> 00:03:15,680 Speaker 3: in my bank account. But interestingly enough, it's actually not 61 00:03:15,760 --> 00:03:18,520 Speaker 3: that much money for these companies. Stake. One of the 62 00:03:18,560 --> 00:03:21,560 Speaker 3: brokers in Australia created a really clever post on Instagram 63 00:03:21,680 --> 00:03:23,960 Speaker 3: last week that calculated how long it would take this 64 00:03:24,040 --> 00:03:26,560 Speaker 3: year's advertisers to earn back the money that they spent 65 00:03:26,639 --> 00:03:31,080 Speaker 3: on advertising. So, for the US telecommunications company AT and T, 66 00:03:31,240 --> 00:03:33,959 Speaker 3: it would take twenty minutes. For Pepsi, it would take 67 00:03:34,040 --> 00:03:37,760 Speaker 3: forty four minutes. For some of the beverage companies like Budweiser, 68 00:03:37,800 --> 00:03:40,440 Speaker 3: it would take fifty five minutes. For Salesforce it would 69 00:03:40,440 --> 00:03:42,760 Speaker 3: take two hours and fifteen minutes, and for Uber it 70 00:03:42,760 --> 00:03:45,600 Speaker 3: would take two hours and thirty minutes, which in the 71 00:03:45,640 --> 00:03:47,600 Speaker 3: scheme of things is not really a long time. 72 00:03:48,480 --> 00:03:50,280 Speaker 1: So I think we can all be pretty comfortable that 73 00:03:50,280 --> 00:03:53,400 Speaker 1: these brands make back the money that they spend on 74 00:03:53,440 --> 00:03:55,280 Speaker 1: the ad and they have a bit of fun as well, 75 00:03:55,320 --> 00:03:57,960 Speaker 1: and it's often a time where there are super creative 76 00:03:58,320 --> 00:04:02,880 Speaker 1: advertising ideas. Are there any material effects on the stock 77 00:04:02,960 --> 00:04:05,840 Speaker 1: markets when these type of events take place? 78 00:04:06,200 --> 00:04:08,960 Speaker 3: Interestingly enough, there was some research done out of the 79 00:04:09,040 --> 00:04:11,680 Speaker 3: US which showed that companies are advertised during the Super 80 00:04:11,720 --> 00:04:15,520 Speaker 3: Bowl experience benefits to their stock price as well, performing 81 00:04:15,520 --> 00:04:18,320 Speaker 3: an average of one percent better than the top five 82 00:04:18,400 --> 00:04:22,080 Speaker 3: hundred listed US companies in the ten days trading from 83 00:04:22,160 --> 00:04:24,960 Speaker 3: the Monday before the Big Game to the Friday after 84 00:04:25,040 --> 00:04:27,960 Speaker 3: US So a couple of examples from this year we've 85 00:04:27,960 --> 00:04:30,360 Speaker 3: pulled out for you. So one of them was Coinbase, 86 00:04:30,440 --> 00:04:32,840 Speaker 3: which was one of our favorite ads. If you didn't 87 00:04:32,839 --> 00:04:35,240 Speaker 3: see it, it was a little QR code moving around the 88 00:04:35,279 --> 00:04:39,760 Speaker 3: screen like the DBD player. Unfortunately it never quite hit 89 00:04:40,120 --> 00:04:44,120 Speaker 3: the corner perfectly, which is really annoying. But if you 90 00:04:44,200 --> 00:04:47,040 Speaker 3: scan this QR code you would get fifteen dollars of 91 00:04:47,080 --> 00:04:51,120 Speaker 3: free bitcoin. And the share price of Coinbase jumped from 92 00:04:51,200 --> 00:04:53,560 Speaker 3: one hundred and ninety four dollars to the high of 93 00:04:53,600 --> 00:04:56,000 Speaker 3: two hundred and fourteen dollars last week, which is up 94 00:04:56,360 --> 00:05:00,440 Speaker 3: nine point eight percent. And some other examples included Ruts 95 00:05:00,480 --> 00:05:03,160 Speaker 3: which was up five point seven percent, Salesforce which is 96 00:05:03,240 --> 00:05:06,120 Speaker 3: up three point four percent, and also Amazon which was 97 00:05:06,240 --> 00:05:09,599 Speaker 3: up three point nine percent. So even though that initial 98 00:05:09,640 --> 00:05:11,839 Speaker 3: six point five million sounds like a lot of cash, 99 00:05:11,920 --> 00:05:14,080 Speaker 3: there actually seems to be a lot of benefit in 100 00:05:14,120 --> 00:05:14,520 Speaker 3: doing so. 101 00:05:15,040 --> 00:05:20,960 Speaker 1: And so Maddie talking about domestic markets. Now, I'm sure 102 00:05:21,160 --> 00:05:24,640 Speaker 1: many of us have visited driven past heard of in 103 00:05:24,680 --> 00:05:27,839 Speaker 1: the news, not always for the right reasons. Crown Casino 104 00:05:28,080 --> 00:05:33,159 Speaker 1: and the Crown Holdings Company, they actually got bought this week. 105 00:05:33,279 --> 00:05:35,200 Speaker 1: I'd love to learn a little bit more about that. 106 00:05:35,520 --> 00:05:38,640 Speaker 4: Sure, I will do my best. Sam. So, as we know, 107 00:05:38,920 --> 00:05:41,200 Speaker 4: Crown has been in a little bit of trouble over 108 00:05:41,200 --> 00:05:44,640 Speaker 4: the last twelve months or so, whether it be role commissions, 109 00:05:44,800 --> 00:05:49,920 Speaker 4: licensing issues, or money laundering. So private equity company Blackstone 110 00:05:50,040 --> 00:05:53,320 Speaker 4: first approached Crown in March of twenty twenty one, offering 111 00:05:53,360 --> 00:05:55,839 Speaker 4: to buy the company at a price of eleven eighty 112 00:05:55,839 --> 00:05:58,800 Speaker 4: five per share. Now, after many are to and fro, 113 00:05:59,120 --> 00:06:02,279 Speaker 4: last week, the firm increase their offer to thirteen dollars 114 00:06:02,279 --> 00:06:05,400 Speaker 4: ten per share and Crown's board has recommended that its 115 00:06:05,400 --> 00:06:07,080 Speaker 4: shareholders accept the offer. 116 00:06:07,600 --> 00:06:08,400 Speaker 2: Now you might be. 117 00:06:08,400 --> 00:06:11,520 Speaker 4: Wondering why would Blackstone want to buy Crown given the 118 00:06:11,600 --> 00:06:14,520 Speaker 4: last couple of years it's had. Well, Actually, Blackstone has 119 00:06:14,600 --> 00:06:19,640 Speaker 4: quite considerable experience buying, overhauling, and selling casinos across Las Vegas, 120 00:06:19,720 --> 00:06:24,039 Speaker 4: Europe and Latin America and casino industry analysts, yes, that 121 00:06:24,240 --> 00:06:27,279 Speaker 4: is a thing. Benley has suggested that Blackstone isn't actually 122 00:06:27,360 --> 00:06:30,719 Speaker 4: interested in owning Crown over the long term, but rather 123 00:06:30,920 --> 00:06:34,000 Speaker 4: they'll take ownership, cut costs, fix it up and sell 124 00:06:34,040 --> 00:06:36,640 Speaker 4: it for a higher price, which is an approach. That's 125 00:06:36,720 --> 00:06:39,120 Speaker 4: quite common for private equity. 126 00:06:38,800 --> 00:06:42,280 Speaker 1: And so talk me through what exactly private equity is. 127 00:06:42,400 --> 00:06:44,280 Speaker 1: You've mentioned it a few times now and I'd love 128 00:06:44,320 --> 00:06:46,799 Speaker 1: to kind of dive deeper on that point. 129 00:06:46,920 --> 00:06:50,839 Speaker 4: Yeah. So, private equity or often referred to as PA firms, 130 00:06:50,920 --> 00:06:54,360 Speaker 4: are a form of private investment I investments that are 131 00:06:54,360 --> 00:06:59,159 Speaker 4: not listed on public exchanges such as the ASX. So people, 132 00:06:59,440 --> 00:07:03,480 Speaker 4: generally high net worth individuals, invest their money with pafirms 133 00:07:03,600 --> 00:07:06,520 Speaker 4: as a way to I guess, gain exposure to investments 134 00:07:06,520 --> 00:07:09,520 Speaker 4: that they wouldn't otherwise be able to have. One of 135 00:07:09,560 --> 00:07:13,280 Speaker 4: the ways that pafirms generate returns for investors is through 136 00:07:13,320 --> 00:07:17,440 Speaker 4: buying underperforming established companies like Crown, where they think that 137 00:07:17,480 --> 00:07:20,720 Speaker 4: they have the ability and expertise to make the company better. 138 00:07:21,400 --> 00:07:25,000 Speaker 4: So remember, companies listed on the ASEX have all sorts 139 00:07:25,040 --> 00:07:27,680 Speaker 4: of requirements that they have to abide by, so think 140 00:07:27,800 --> 00:07:32,800 Speaker 4: quarterly earnings announcements and reporting. So by taking public companies private, 141 00:07:33,000 --> 00:07:35,280 Speaker 4: as is the case for Crown because it's currently listed 142 00:07:35,320 --> 00:07:39,320 Speaker 4: on the ASX, Blackstone is able to remove the company 143 00:07:39,360 --> 00:07:41,960 Speaker 4: from public scrutiny that they're getting all the time and 144 00:07:42,040 --> 00:07:44,400 Speaker 4: really allow it to take more of a long term view, 145 00:07:44,560 --> 00:07:47,240 Speaker 4: bettering the company rather than trying to keep shareheld as 146 00:07:47,280 --> 00:07:48,560 Speaker 4: happy in the short term. 147 00:07:48,720 --> 00:07:51,800 Speaker 1: I kind of think of it sometimes as like flipping 148 00:07:51,880 --> 00:07:54,880 Speaker 1: an unrenovated house and putting it back on the market 149 00:07:54,920 --> 00:07:57,760 Speaker 1: a couple of months later. People whose job it is 150 00:07:57,760 --> 00:08:01,000 Speaker 1: is to find houses in maybe good air that have 151 00:08:01,160 --> 00:08:04,720 Speaker 1: potential to become better and snapping them up for a 152 00:08:04,760 --> 00:08:08,239 Speaker 1: bargain and flipping them around sounds like some pretty interesting work. 153 00:08:08,640 --> 00:08:11,440 Speaker 1: It's Monday morning, So what is on your radar as 154 00:08:11,480 --> 00:08:15,200 Speaker 1: you're sipping your coffees this morning for a big finance 155 00:08:15,240 --> 00:08:17,640 Speaker 1: story that you're keeping your eye on this week? Guys. 156 00:08:18,400 --> 00:08:21,400 Speaker 3: A finance story that I will be watching this week, 157 00:08:21,480 --> 00:08:24,040 Speaker 3: even though it occurred last week, was that the Aussie 158 00:08:24,200 --> 00:08:28,640 Speaker 3: lithium minor Liontown Resources, signed a five year contract with 159 00:08:28,680 --> 00:08:32,200 Speaker 3: Tesla to supply one hundred thousand tons of lithium per year. 160 00:08:32,360 --> 00:08:34,679 Speaker 3: I'm really researching the lithium space at the moment. I 161 00:08:34,720 --> 00:08:36,720 Speaker 3: think it has a lot of potential with the electric 162 00:08:36,800 --> 00:08:39,960 Speaker 3: vehicle market. So it's one I'll be watching and one 163 00:08:39,960 --> 00:08:41,640 Speaker 3: I'll definitely be researching as well. 164 00:08:41,960 --> 00:08:44,559 Speaker 1: It's going to be really interesting to see some policies 165 00:08:44,559 --> 00:08:47,600 Speaker 1: coming out of both the major parties and the lead 166 00:08:47,679 --> 00:08:50,960 Speaker 1: up to the federal election around electric vehicles, Sophie and 167 00:08:51,400 --> 00:08:54,880 Speaker 1: as more companies from Australia get picked up by Tesla 168 00:08:55,040 --> 00:08:58,319 Speaker 1: and those kind of giants, it's a really exciting space. Maddie, 169 00:08:58,360 --> 00:09:00,840 Speaker 1: is there anything that is catching your Yeah. 170 00:09:00,960 --> 00:09:04,040 Speaker 4: Late last week Origin Energy announced that they're shutting down 171 00:09:04,080 --> 00:09:07,320 Speaker 4: one of their coal fired power stations five years early, 172 00:09:07,440 --> 00:09:09,679 Speaker 4: which sounds like great news, but there's been a bit 173 00:09:09,720 --> 00:09:12,560 Speaker 4: of fall out coming up to the election with people 174 00:09:12,640 --> 00:09:15,760 Speaker 4: concerned that we're not going to have enough energy for power. 175 00:09:15,880 --> 00:09:17,880 Speaker 4: So keeping a close eye on this one to see 176 00:09:17,880 --> 00:09:19,120 Speaker 4: how the markets react. 177 00:09:19,440 --> 00:09:24,040 Speaker 1: Two big energy stories from the YIGC ladies to kick 178 00:09:24,080 --> 00:09:27,439 Speaker 1: you off on your Monday morning, hoping that charges your batteries. 179 00:09:27,800 --> 00:09:30,040 Speaker 1: That's all we've got time for on the Dahlias this morning. 180 00:09:30,080 --> 00:09:32,360 Speaker 1: It's been a pleasure having Sophie and Maddie from your 181 00:09:32,360 --> 00:09:35,040 Speaker 1: own good Company on the podcast. You can listen to 182 00:09:35,080 --> 00:09:38,319 Speaker 1: them wherever you're listening to this podcast. Have a sensational 183 00:09:38,360 --> 00:09:40,560 Speaker 1: Monday and we'll be back in your ears tomorrow morning.