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National Business Review
A YEAR OF CONSOLIDATION FOR RICH LISTERS
Friday, 30 July 2010

The 24th National Business Review Rich List 2010 published on Friday, July 30, welcomes newcomers, technology businessman Rod Drury (whose family trust is the biggest shareholder in accounting software company Xero), and property developer John Sax (whose canny attitude to investment through his Southpark Corporation has resulted in a spectacular portfolio). Over the past year the Rich List has remained remarkably stable despite the lingering recession and what can best be described as a fragile recovery. These debuts therefore are a highlight.

Allan Hubbard and Terry Serepisos are missing in action from the 2010 Rich List. Although both are still worth a considerable amount, at press time Mr Hubbard is in statutory management and Mr Serepisos has had well-publicised cash-flow issues making it difficult to accurately assess their net worth. News Editor Ellen Read says NBR arrives at the best possible Rich List from readily and publicly available information and, given the uncertainty around both those men at present, it was thought prudent to put them on hold in order to retain the integrity of the list.

There are six billionaires on this year’s List. These are packaging king, Graeme Hart with a value of $5.5bn who tops the National Business Review Rich List, the Todd family with a value of $2.7bn, Irish farmer and property investor Eamon Cleary with a value of $2bn, New Zealand’s richest woman Lynette Erceg with a value of $1.5bn, investor brothers Christopher and Richard Chandler, each valued at $1.4bn.

Ms Read points to the changing nature of wealth generation, evidenced by the inclusion of Rich Listers who have earned their place through intellectual property, ideas and technology. Ms Read says that will be particularly evident in the ‘Rich List Radar’ to be published later this year, but notable on the Rich List released today in this context are filmmaker Sir Peter Jackson ($500m), entrepreneur Sam Morgan ($290m) business academic and one of the world’s top 50 business intellectuals, Dr David Teece ($180m), dot-com pioneer Steve Outtrim ($110m), film industry operators Nigel and Susan Standford ($95m) and publisher Wendy Pye ($70m).

While the property market has consolidated over the past year, two years of record harvests and oversupply of grapes has hurt New Zealand’s wine industry and this is reflected in the valuations. Winemakers Jim and Rosemari Delegat, the Giesen family, George Fistonich, Brent Marris and Peter Yealands remain secure on the Rich List, thanks to the maturity of their businesses, scope of their operations abroad and ability to find opportunities in global markets that one would least expect.

This year there are 150 NBR Rich Listers with 100 men, 3 women, 39 families and 8 pairs. The overall wealth on the Rich List has decreased slightly this year, down to just over $38 billion compared with the $39 billion net total recorded in 2009. The threshold for inclusion in the 2010 NBR Rich List remains at $50 million.

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NBR editor in chief Nevil Gibson describes the past year as a year of bouncing back. He points out that international wealth trends show the number of wealthy individuals continues to rise.

“The 2010 World Wealth Report says the number of wealthy individuals rose 17% to 10 million in 2009. Financial wealth increased 19% from 2008 levels to $US39 trillion after a drop of 24% in 2008. Among the super-rich, which includes many on the Rich List who do not have all their wealth tied up in a single business, the rebound was even greater at 21.5%.”

Mr Gibson also points out that New Zealand was fortunate because it is economically integrated into the Asia Pacific region. “The assets of this region’s wealthy surged 31% to $US9.7 trillion, more than erasing 2008 losses and surpassing the $US9.5 trillion in wealth held in Europe. This is a remarkable shift and will be a continuing source of further wealth as New Zealand businesses and investors gain a bigger share of the action,” he said.

ABOUT THE NATIONAL BUSINESS REVIEW:

The National Business Review, owned and published by Barry Colman, is published each Friday. It provides an in-depth wrap up and analysis of each week’s business events. NBR Online is a standalone news service that provides up to the minute specialist business and finance news. The online content is not included in the paper and is unique to the online service. The National Business Review newspaper celebrates its 40th anniversary on August 26.

FAQS

1. How is the National Business Review Rich List compiled?

The National Business Review Rich List is a guide to those the NBR team deem worthy of interest as examples of business achievement and investment success.

Some valuations are easy to arrive at because the wealth is visible and listed shares can easily be valued.

Where wealth has been created in a private company that has then been sold, the value of the family is established at date of sale and then incrementally increased or decreased each year depending on subsequent business activities and investments.

Where the wealth remains in a large private company and no value is placed on the business then valuation starts with turnover figures and profit margin percentages in similar listed companies, and more detective work follows.

Some on the National Business Review Rich List are also listed internationally which provides a benchmark.

Decades of success in development and investment, as well as ‘old money’ passed from generation to generation can be reasonably listed close to asset value.

2. How does the total combined wealth of this year’s National Business Review Rich List compare with that of 2009?

The total combined wealth is just over $38 billion in 2010, down a little from the $39 billion net total recorded in 2009.

3. How many New Zealanders are there on this year’s National Business Review Rich List?

This year there are 150 Rich Listers - 100 men, 3 women, 38 families and 7 couples or partners.

4. Are there any individuals one would expect to be on the National Business Review Rich List who are missing in action this year?

Allan Hubbard and Terry Serepisos are missing in action. While both are still worth a considerable amount, at press time Mr Hubbard is in statutory management and Mr Serepisos has had well publicised cash-flow problems which means it has not been possible to accurately assess their value. Mark Hotchin and Bill Birnie, who have also experienced well-publicised financial issues, are also on hold this year.

5. What is the thinking behind re-indexing the National Business Review Rich List?

The Rich List invariably has multiple entries at one level, for example two people or families in fifth equal position. In re-indexing the Rich List we now count the next wealthiest as the next numerical entry. So – while their might be three 5th= entries, the next richest individual or family is now recorded, more accurately, in 6th position rather than 8th position as has been done in the past.

6. Where is serious wealth currently being generated?

Serious wealth is increasingly being generated through intellectual property and ideas. This will become more evident in this coming year as we see significant wealth being generated in ideas, IT and technology.

7. How many billionaires are there on this year’s National Business Review Rich List?
There are six billionaires on this year’s List. These are packaging king, Graeme Hart with a value of $5.5bn who tops the National Business Review Rich List, the Todd family with a value of $2.7bn, Irish farmer and property investor Eamon Cleary with a value of $2bn, New Zealand’s richest woman Lynette Erceg with a value of $1.5bn, investor brothers Christopher and Richard Chandler, each valued at $1.4bn.

NBR RICH LIST 2010 BASIC FACTS

The top ten positions:

1 Graeme Hart $5.5 billion
2 Todd Family $2.7 billion
3 Eamon Cleary $2 billion
4 Lynette Erceg $1.5billion
5= Christopher Chandler $1.4 billion
5= Richard Chandler $1.4 billion
6 Goodman Family $850 million
7= Stephen Jennings $800 million
7= Sir Douglas Myers $800 million
8= Sir Michael Fay $750 million
8= David Richwhite $750 million
9= Michael Friedlander $700 million
9= Spencer family $700 million
10 Peter Cooper $650 million

Wealth by industry: (please note these are rounded figures which cross multiple sections and therefore will not precisely add up to the Rich List total net worth)

Wine $0.8b 9 entries
Tourism $0.450b 5 entries
Services $1.3b 12 entries
Technology $1.7b 18 entries
Retail $1.8b 9 entries
Real estate $0.4b 4 entries
Property $8.8b 35 entries
Media $1.1b 7 entries
Manufacturing $1.6b 13 entries
Investment $19.2b 32 entries
Horse breeding $0.3b 3 entries
Finance $2.7b 6 entries
Construction $0.6b 6 entries
Automotive $1.8b 6 entries
Agribusiness $1.8b 13 entries
Total: $44.426b 178 entries

ENDS

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