MICK McCormack is busily carving up Australia's gas pipeline sector with the same clinical approach he uses to slaughter cattle, sheep and pigs on his beloved property near Killarney, close to the Queensland and NSW border.
In yet another aggressive move, the 52-year-old is bidding $1.3 billion to take control of 22,500 kilometres of pipeline that carry vital natural gas to the households of eastern Australia. If successful, the deal will make APA Group one of the top 40 companies on the Australian Securities Exchange; a $6.6 billion infrastructure owner that will be larger than household names such as Leighton Holdings and Lend Lease.
The bid for Envestra, the owner of distribution networks in South Australia, Victoria, Queensland and NSW, is part of a deliberate strategy by APA Group to beef up in size to attract more investment capital.
APA is already the owner of more than 13,000 kilometres of long-distance gas pipelines, but has a relatively low profile that belies its importance as a major energy transporter, shifting half the gas moved around the nation.
Combine APA with Envestra's network of smaller pipelines and you have infrastructure that delivers gas to everything from households in Melbourne to gold mines in Western Australia.
McCormack is a rare breed. He is probably the only Australian chief executive who knows how to kill a cow or a sheep and slice it up in his own butchering facility to produce classic cuts of meat and a range of tempting smallgoods.
"I'm a pretty decent dab hand at the smallgoods,'' he says.
McCormack, who was born in Proserpine, learnt from a young age how to slaughter livestock on his parents' cane and grazing property, and his down-to-earth approach has carried right through his corporate career.
"Right from the age of 10 or 12 I could dress a beast,'' he says.
When McCormick addressed an annual gathering of the Australian Pipeline Industry Association in Darwin, his speech was on the merits on connecting the Northern Territory's gas grid with eastern Australia. But it is consolidation of another sort that has everyone talking.
McCormick's aggressive acquisition strategy – which has built APA from a business of 30 people with assets owned or operated of around $1.3 billion in 2005 when he became chief executive to an energy sector behemoth with a workforce of 2000 and assets of $10 billion-plus – has meant in the past few years he hasn't been able to spend as much time as he would have liked on the family farm.
His local butcher at Killarney is a firm admirer of McCormack's precise skills with the carving knife, and his no-nonsense approach.
Says Greg Power from the Killarney Butchery: "He's a very good bloke.
"We used to cut up his meat all the time but he does a lot more of it himself. He loves messing about with that sort of stuff."
APA's move on Envestra comes just six months after it wrapped up a long-winded and troublesome $1.6 billion takeover of Hastings Diversified Utilities Fund (HDF), bolstering its already dominant position in gas transportation in the eastern states.
Earlier acquisitions included pipelines in the NT, Queensland and NSW, a wind farm and electricity transmission lines, as well as the corporate takeover of GasNet.
For McCormack, the acquisitions are part of a drive for scale that will enhance APA's ability to achieve economies and pursue larger investment opportunities in new pipelines.
"I'm in a simple industry – it's scale economies, that's infrastructure," he says. "The more you have of it and the better you're able to operate [what you've got], your costs go down, you're able to do more."
Some of the new investments APA is eyeing were discussed in meetings held by McCormack in Darwin over the last few days, including with NT Chief Minister Adam Giles, who is keen to push the development of the gas industry.
Among them is an ambitious plan to link the NT gas grid with that of Queensland, hugely expanding the potential sales market for the territory's growing band of gas explorers, as well as a pipeline link south for shale gas player Armour Energy and a proposed new pipeline to Rio Tinto's Gove alumina refinery in Arnhem Land.
APA has also made no secret of its interest in picking up pipelines being built as part of the new LNG export projects in Queensland.
McCormack found his way into the pipelines industry when he started "digging holes" for Moonie Oil Company, despite having completed a degree in surveying at the University of Queensland.
"It was a case of a young bloke taking the money," he says.
After a couple of years of "roughneck stuff on the pipelines", McCormack – unimpressed with what he saw of management – decided to move to a desk job, going on some years later to complete an MBA at University of Queensland and then an engineering degree at Monash University.
"The MBA was a real game-changer for me," he says. "All of a sudden you start to understand the theories in management and leadership and away I went."
His property near the township of Killarney, which has a population of around 1000, has been something of a haven for McCormack, who spends his working week at APA's Sydney office and returns most weekends. There are cattle, sheep, pigs and poultry on the property, which is adjacent to the Condamine River. The family moved there 15 years ago.
McCormack acknowledges the sacrifices that have been made as he has pursued a corporate career from a Sydney base, and says he gets his best ideas about corporate strategy in the clear Queensland country air.
Those ideas always flow much better while mending a fence or ''dressing down a pig carcass''.
McCormack is proud of his strong work ethic and says after eight years at the helm of APA, he has no intention of slowing down. He is conscious that he has easily exceeded the average tenure of a chief executive in corporate Australia, but says there's still much to do. "Hopefully I've got a couple of years left in me yet,'' he says.
McCormack has a reputation as a tough negotiator, but says APA's business ethics reflect his own: "fair-dealing, robust".
"At our end of the swamp, it's a big business, so the negotiations we have tend to be robust and once things are settled contracts run for long periods, so we have some fairly spirited discussions, then we are friends for 10 or 15 years.
"I always would like to think we leave something on the table: we're not a win-lose outfit. If you do a deal with somebody, you like to think that both they and us go away reasonably happy."
