Ski And See: Rydge Makes His Run
Sydney Morning Herald
Tuesday December 30, 1986
The film camera in the corner is positively antique. The lights are definitely deco, the venetian blinds are original and the mammoth desk was father's favourite. At 34, Alan Rydge is the youngest thing in the chairman's office of Greater Union.
Mr Rydge is used to being the youngest. He is the youngest of Sir Norman Rydge's three sons. At 27 he was the youngest chairman of a public company and he is one of the youngest people in Australia to be worth an estimated $55 million.
All this sits quite easily on him. So does his recent purchase of Thredbo Village for $18 million from Lend Lease Corporation Ltd. Thredbo Village has hardly been a goldmine in recent years. Perisher Valley's facilities have been upgraded and there will be further competition from Mount Blue Cow, Kerry Packer's $30 million ski resort scheduled to open next winter. But Rydge has definite plans to reverse its meagre returns by spending $25 million in the next few years to improve both winter and summer facilities.
He also wants to expand his small chain of four Noah's hotels and 15 motels and to boost tourism in Canberra and the snowfields, which are only an easy drive away.
Greater Union's parent company, Amalgamated Holdings Ltd, owns the Canberra International Hotel and is building a $28 million hotel, The Pavilion, on a site overlooking the new Parliament House. The company is planning holiday packages for people to spend a couple of days in Canberra and then a stint in the snow.
"We received an indication in June that Lend Lease was willing to sell. We took a look at it, did some sums and entered into serious negotiations. We didn't set out to buy a snowfield, but it's very exciting for us and has significant appeal because we can cross-link it with other investments."
Amalgamated Holdings, as Rydge puts it, is on the expansionary trail, with hotels, a controlling interest in Adelaide's 5KA radio station, 15 new screens in Western Australia, and Thredbo Village. There is more to come, says Rydge.
The strike-plagued George Street complex will be finished early next year. Three cinemas at Parramatta will open later in the year and twin cinemas in Mosman are to be revamped. His shopping list for 1987 includes more radio stations, or perhaps a television station, but only when the time and the price are right.
"Personally, the acquisition which most excited me this year was the one in Western Australia, because it completed our national circuit, something which had eluded us for a long time." Greater Union now has 63 screens, compared with 45 owned by Hoyts and Village Roadshow's 80.
But the deal which he is most proud of is the one his of which his father would have thoroughly approved: the buying out of the Rank Organisation's 50 per cent stake in Greater Union in 1984 for $19.8 million. Rank no doubt was willing to sell because of the disastrous effect of the video revolution on the box office. That faltered, and Greater Union, like its competitors, has enjoyed a 15 per cent increase in box-office takings this year.
"It was a deal very close to my heart, in terms of a sense of achievement as a family and also as an Australian, to make it all 100 per cent Australian."
Alan Rydge and his father enjoyed a good relationship. Sir Norman was in his 50s when his third son was born. He had achieved great success both with Greater Union and the business journal Rydges, which he founded when he was 28. He had the time and the inclination to enjoy being a father.
"When I was little, my father didn't really have to go away on that many business trips any more, so we were able to spend a great deal of time with each other. I was very lucky."
Alan at nine was passing around the sherry at cocktail parties attended by some of Australia's most powerful businessmen. He was encouraged to participate and voice his opinions. Sir Norman often discussed his own business negotiations with his small son when they sailed together on their boat, a 13-metre called Alanor, an amalgam of their two names.
It was education by osmosis. By the time Alan was a teenager and driving a battered Valiant (Sir Norman was not extravagant with pocket money), he had been privy to all the canniness and wisdom that his father had accumulated since he began working life selling icecream in Newtown.
"I got on very well with my father and I thoroughly respected the direction he took in life. We really were very close. Oh, I may have threatened to leave home a couple of times, but basically I saw no need." He still doesn't. He and his wife Lynne continue to live in a converted boat shed at the bottom of the family home in Point Piper.
His older brother Norman, 57, still publishes Rydges. Says Alan: "He studied law, but didn't want to practice it. Norman was much more interested in publishing." The second brother, Richard, 56, was always obsessed by boats and still operates a boat-building business in Marrickville, where Alan worked for a year when he first left school, before deciding to join his father's company.
Alan Rydge is no rebel, something which many pointed out when he took over as chairman of Amalgamated Holdings after his father died in 1980. Sir Norman could never be accused of overborrowing, which was, in his vocabulary, a bit of a dirty word. Asked then if he would change anything, young Alan replied firmly: "I don't think so."
Sitting so comfortably at his father's desk, with his father's portrait beaming down on him, Alan at first did little to change his conservative reputation. Greater Union, with all its assets, seemed destined to dodder on as the biggest cinema owner in Australia. By comparison, Hoyts and Village Roadshow were positive and dynamic.
But Sir Norman had taught his son supreme confidence as well as tricks of business. Even when he became Australia's youngest public chairman, he remembers: "Dad had confidence in me and that rubbed off. Of course I was nervous, but I had a certain expertise and I had to put that on the line. I knew my own performance and the question was whether the public shared that view."
They did. Alan Rydge took his time, but within five years, most of the old Greater Union guard had gone, replaced with a savvy marketing team headed by chief general manager John Rochester. Rochester is keenly aware of target audiences and not afraid to borrow research and marketing techniques from his competitors.
"Marketing is the biggest single change in our organisation," says Alan. "We now consider it absolutely vital in everything we do."
The organisation in fact used to have no marketing. It merely borrowed the same material for each film used for overseas release and ran it when the film opened in Australia. All that has changed. Advertising campaigns are carefully orchestrated to woo local audiences with offerings like Out of Africa and Room with a View.
Greater Union may not have had Crocodile Dundee this year, but its subsidiary, Colourfilm Pty Ltd, has printed and processed all the copies in world-wide release, and cinema owner Birch, Carroll and Coyle, in which it has an 87 per cent interest, distributed Crocodile Dundee in Queensland.
Alan said: "We've had a good year, anyhow. And we've got Heartburn and Star Trek IV coming up, which will be good for us. Things are going well. We've got five-year plans coming out of our ears. Now the only thing we have to do is make them work."
© 1986 Sydney Morning Herald