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Bondy’s greatest assets also led to his downfall

Bondy. There aren’t many people who are instantly recognisable by one name but it is testament to the extraordinary life that Alan Bond lived that all these years later there is no consensus about whether he was more hero than villain.

Any accounting begins with the America’s Cup and the profound sense for West Australians of certain generations that he put this State on the map. For that, his many sins — of corporate governance, excess and, yes, fraud — are, if not excused, at least are placed in a context not afforded common crooks.

Bond’s achievements are etched as physical and psychological contours of the State: the Bond Tower at 108 St Georges Terrace, Observation City, the Lord Forrest Centre in Bunbury and the Super Pit.

Bond’s great assets — his self- belief and his powers of persuasion — were probably the same characteristics that led to his downfall. Amid roiling 1980s capital markets, international bankers, who had financed Bond’s outlandish series of acquisitions, fell over themselves to lend him ever more cash. It was the John Paul Getty principle: if you owe the bank $100, you have a problem, but if you owe them $100 million, the problem is theirs.

In trawling the 1982 WA Cabinet papers two years ago, I discovered an untold Bond tale that illustrated how he put his powers of persuasion to work.

Amid a complex capital raising that would allow him to take control of Austmark, a foundering publicly listed company which had the Observation City and Bunbury Tower projects on its books, Bond was $2.5 million short.

With a deadline looming, Bond picked up the phone and called Liberal premier Ray O’Connor. Bond told O’Connor it would be bad for everyone if Austmark collapsed, because it would harm confidence in the fragile economy. He asked the government to stump up the $2.5 million.

O’Connor sent the problem to under-treasurer Les McCarrey, who sent it to the only person in government in a position to do such a deal on short notice, managing director of the SGIO Harry Mellor. Mellor objected, but Cabinet sided with Bond and the shares were taken up within the week. The capital raising and takeover proceeded and the rest is history. Austmark became known as the property development arm of Bond Corporation and was ultimately acquired as a fully owned subsidiary.

Austmark never recorded a profit and by 1990 its net liabilities had reached $157 million despite a glittering property development portfolio.