Model stripped bare

Several years ago, the Macquarie Model became the rage, with plenty of observers raging against the vampirist fee consumption of its infrastructure vehicles.

So how is that working out?

Well, one of the most famous me-too's, Babcock & Brown, has imploded on the weight of its own over-leveraged excess.

Now we're being treated to the spectacle of one of Macquarie's cash-cows hijacking investors for more lavish treatment purely for the price to get it of their backs.

That's how Ian Verrender sees it in the SMH:

Nothing but complete contempt for investors

During the past seven years, Macquarie has reaped a $527 million fee bonanza from MAp, even though it now concedes that managing the airport fund cost just $11 million a year. Multiply 11 by seven and then look at the difference.

As a final insult, Macquarie wants MAp unitholders to hand over $345 million to sever the links, an amount that the independent directors think is a good deal and which has been ticked off by an independent expert KPMG.

During the past two months, Macquarie has shown utter contempt for the investors who poured their hard earned into MAp during the boom - and all those other infrastructure funds - as it desperately tries to cut the airport fund loose.

But what has been truly disturbing during the past few weeks is the cavalier approach to corporate governance shown by MAp, and in particular the woeful performance of MAp's so-called independent directors

The simple fact is Macquarie Group is desperate for the $345 million that it will be paid to walk away from MAp.

There is every indication it wants to book the money as earnings in the September half.

That money is likely to flow almost straight through to the bottom line, providing a substantial portion of the profit for the first half and the basis for executive bonuses.

The independent directors claim the Macquarie deal is the only viable option because, without its co-operation, a banking syndicate owed $4 billion may call in those loans or try to renegotiate them on higher rates because there has been a change of control.

Guambat wonders if, perhaps, the change of control clause may have been purposefully negotiated and drafted just for such an event. It's called a poison pill in other places.