Once mighty Australian businessman watches fortunes dwindle

By GREG ANSLEY

This was John Dorman Elliott's week for singing the blues. A fortnight after the Carlton Football Club dumped him from a presidency that had lasted 20 years, the once-mighty Blues were facing disaster from a A$930,000 ($1 million) fine for their third salary-cap breach in four years.

Worse, the club has been excluded from selection drafts that will deprive Carlton of fresh new talent and allow it to win only second-string players as it tries to recover from its first Australian Rules wooden spoon in its 105-year history.

Carlton will take years to recover, providing it can survive the immediate financial crisis.

Elliott snarled that the penalties were vindictive, but the facts were indisputable: over five years and under his administration, the Blues had made secret payments above capped salary levels to four key players, totalling A$500,000 ($562,000).

Carlton's books are in a similar mess. On top of the huge fine imposed by the AFL Commission, the club is expected to record a A$500,000 loss this year and face a A$10 million paper debt from the write-down of grandstands at its home base, Optus Oval.

One of those stands is named after John Elliott, another of the legacies that the one-time colossus of Australian business, politics and sport has left Carlton.

But he has his own problems to worry about. Elliott, separated from his second wife and living in a rented flat, is fighting for the remaining scraps of his life as his one-time partner pushes him towards bankruptcy, and Australia's corporate police pursue him over the affairs of the collapse of his final grand venture.

His lawyers' bills from a decade of litigation have run into millions, he has been excommunicated from the Melbourne establishment that once sponsored his rise and has been scorned by Australia's business community.

Elliott offended Aborigines so deeply by publicly describing them as "unimportant" and "backward" that elders of the Yorta Yorta people - whose traditional homeland includes the two vast rice farms that formed Elliott's last big gamble - placed a curse on him.

"May you and your kind and all you own rot away," the curse intoned. "May the wind of change sweep you away and put you away from the feet of the people you despise."

Two weeks ago the largest and most important of his rice farms, at Cobram in southern New South Wales, was sold by its receiver, Deloitte Touche Tohmatsu, for almost A$22 million ($25 million).

Elliott's other major asset, Madowla Park, a companion rice farm in northern Victoria, is expected to follow shortly, after an in-principle sale was agreed to as-yet- unnamed buyers.

The man whose ego was once likened to a helium balloon in full flight soared too close to the sun. He survived others of his cowboy generation, escaped the clutches of the posse that spent a decade chasing him over dealings with jailed New Zealand colleague Allan Hawkins, and tap-danced around regulators and creditors for years.

But in the end, with few friends, a relative pittance in his once-overflowing pockets, and the posse finally closing in, Elliott's stature was summed up in a warning relayed in court from a burned associate: "Don't touch him with a 40-foot barge pole".

One commentator wrote that Elliott was "a belligerent, unlovely testament to the power of positive thinking".

The giant with the trademark guffaw, the larrikin who carved a swathe through Australian life for three decades with a Fosters in one hand and a perpetual cigarette in the other, has been undermined by his feet of clay.

If the Australian Securities and Investments Commission has its way, Elliott will lose another large part of his remaining assets and also the key to any possible recovery: ASIC wants him banned from all company boardrooms.

This is more than a financial execution. Boardrooms and executive suites are Elliott's lifeblood, the meaning of his existence.

"I was never driven to be wealthy," he told The Bulletin this year. "I have always been driven by doing things. I love going to work. I say to people, 'Why go on holidays? Going to work every day is a holiday for me'."

His now-estranged wife Amanda said much the same thing a decade ago as Elliott began his steep, painful dive: "When [his company] Harlin didn't work out as planned, some people said he ought to go to our place in France for six months and relax. They don't understand. He's relaxed when he's working".

On these values Elliott has been a very relaxed man for a very long time.

Born in 1941 into a comfortable, middle-class Melbourne family, Elliott was educated at Carey Baptist Grammar School and Melbourne University, where he gained a master's degree in business administration on a BHP scholarship and caught the eye of Sir Roderick Carnegie. These were two seminal markers in Elliott's career.

Carnegie was then the Australian head of leading international consultants McKinsey and Co, where Elliott was to spend his first formative five years in business, working in the company's Melbourne and Chicago offices.

The university scholarship had helped Elliott to win the friendship of BHP chairman Sir Ian McLennan, a pillar of the Melbourne establishment whose support gained Elliott entry - if never full acceptance - and also provided a far more important foothold.

In 1972 McLennan helped the 31-year-old Elliott to secure a A$15 million ($17 million) loan to take over long-time Tasmanian jam-maker Henry Jones (IXL), launching a cut-throat campaign of hostile takeovers, elaborate tax schemes and other devices to carve out a significant slice of corporate Australia and the image of a hard-drinking, hard-living antihero that appealed to the Australian psyche.

Within a decade Elliott was ready for the big time, winning the venerable pastoral house Elders Smith Goldsborough Mort, renaming it Elders IXL and embarking on an aggressive drive for even bigger fish.

Over the next six years he took over Carlton United Breweries, revamped the new group into five divisions, swallowed British brewer Courage and repaid the Melbourne establishment by buying 19 per cent of BHP to save the steel giant from rapacious West Australian entrepreneur Robert Holmes a Court, turning a tidy profit in the process.

In 1989, through the private company Harlin Holdings, Elliott led a A$2.5 billion ($2.8 billion) management buyout of Elders. By that time Elliott was at his peak: immensely rich, with a house in France, a multi-million dollar beach property, farms, and myriad other interests with a total value of about A$100 million ($113 million).

He was immensely popular as president of the Carlton Football Club and Liberal Party president, even touted as a likely prime minister.

But Harlin was his downfall. With massive debts, Elders, now renamed Fosters Brewing Group, squeezed out Elliott, and receivers were appointed to Harlin, also now renamed as International Brewing Holdings.

Across the Tasman, Equiticorp chief Allan Hawkins was jailed for dealings linked to Elliott, which in turn set the National Crime Authority on to Elliott in a long, complex chase which ended in 1999 when he was acquitted on a technicality. The NCA then began a further pursuit over trading in Eurobonds.

Elsewhere, Elliott's investment in rice was also turning to dust. His bid to revolutionise production and trading ran against a rigidly regulated market. Water Wheel, a milling company bought as a key part of the strategy, went to the wall, and Elliott is now back in court accused of allowing the company to trade while insolvent.

His partner in the venture, a Californian investment company owned by the family of Roy Disney - a nephew of Walt - has successfully sued him for about A$400,000 ($453,000) and has promised to place him in bankruptcy if he does not, or cannot, pay up.

His rice farms have now gone the same way as his villa in France, his chairmanship of Carlton, his political pretensions, and his welcome in the clubs of the Melbourne elite.

His home life is hardly any better. His first wife, Lorraine, whom he married in 1965 and divorced after 20 years' marriage and three children, realised his political ambitions and was elected in 1992 to the safe State Liberal seat of Mooroolbank.

Last March his second wife, Amanda, announced that their 15-year-old marriage was over after Elliott sold their mansion in the ultra-rich suburb of Toorak without telling her.

Amanda and their 12-year-old daughter Edwina now live in another Toorak home, while Elliott bunks down in a flat.

Elliott is not yet destitute by any means, with a 10,000ha farm near Hay in NSW, a woolpacking business in Romania, other rural and property holdings and a significant slice of a successful computerised data managing system.

Elliott once summed up the bad times: "Life comes in waves, doesn't it?"

But with the hounds still after him, legal bills mounting and a battered reputation, even Elliott's monumental self-confidence may not save him from the dumpers.