When it comes to the massive private wealth in New Zealand, the ‘tall poppy syndrome’ is nearly dead. While New Zealanders once regarded an individual’s accumulation of enormous riches as somewhat unseemly or at least to be viewed with suspicion, with the rise of neoliberalism and the decline of our egalitarian ethos, unfortunately we are now more inclined to worship the rich. This adulation of the affluent is one of the key political agendas of the National Business Review in publishing the Rich List each year. The newspaper wants us to know about the ‘wealth creators’ and turn them into role models – despite the fact that these businesspeople are really ‘wealth stealers’ in that their vast profits come from other people’s toil. Nonetheless the NBR’s celebratory exercise is a useful project that allows us to gauge some important aspects of the ruling elite in New Zealand, and it unintentionally shines a bright light on the vast iniquitous grab of wealth and income in New Zealand society. [Read more below]
When the Rich List started in 1986 – near the beginning of New Zealand’s neoliberal revolution – the NBR could only find 55 individuals worthy of the list, and a mere $6.8m would get you a spot. Over time and with the burgeoning growth of the super rich in New Zealand, the newspaper had to constantly raise the threshold criteria, and by 2010 you needed to a net worth of $50m to be included.
So in studying the NBR’s Rich List you’re not just looking at ‘millionaires’ but extreme multi-millionaires. In fact there are six billionaires on this year’s Rich List. At the top of the list, Graeme Hart is worth $5.5b. And the value of the whole list adds up to an astonishing $38b.
Little reduction in wealth during the recession
One of the interesting aspects of the 2010 Rich List is that it shows how little the elite has been suffering from the continuing economic recession. The NBR says, ‘The overall wealth on the Rich List has decreased slightly this year, down to just over $38 billion compared with the $39 billion net total recorded in 2009’. In fact a number of the Rich List seem to be doing particularly well from the recession. The NBR says, for example, ‘Outspoken 70-year old property magnate Sir Bob Jones is one of the country’s few businessmen who looks forward to a downturn and he doesn’t understand why other property people haven’t done better in the recession. “We thrive in times like this – this is the time when we buy again”’.
Likewise, the Bayley family’s fortune has jumped from an estimated $120m to $150m in 2010 – based on their ‘Bayleys Real Estate’ empire. According to Bayleys managing director, Mike Bayley, ‘Various members of the family are investors in a spectrum of the property sectors and with the past 12 months providing so many outstanding buying opportunities, a number of members of the family have taken advantage of those opportunities’.
Overall there appears to be a fair bit of ‘canny countercyclical property’ investing going on. All sorts of other business activity seems to be either benefiting from or be immune from the downturn. Property investor and publican Shane Armstrong (owning the Grumpy Mole, Lone Star, Coyote Bar, etc; pictured on the right) told NBR that ‘Business is booming. I think I said the same last year but whether people are happy or sad they drink, and when they drink we’re happy’.
The luxury of the rich
Reading the NBR Rich List certainly gives you a sense of the outlandish and ostentatious luxury of New Zealand’s elite. Top Rich Lister Graeme Hart ‘and wife Robyn live in a $22 million house in the Auckland suburb of Glendowie, own land at Waiheke and are understood to have recently bought a Pacific island’. Another Waihekean, John Spencer, owns a luxury 49-metre super yacht, T6, that is apparently worth $81m. He also owns a $2.2m Eurocopter which he keeps ‘parked in a watertight hanger under the yacht’s deck’. Doug Myers and Alan Gibbs co-own a 59-metre adventure super yacht. Similarly, Andrew Bagnall (#36) has a ‘luxury nine-seat Gulfstream G200 private jet’. For Craig Heatley (#28), ‘Home is a $13.7 million beachfront mansion in Takapuna, on Auckland’s North Shore. He also owns part of the $22.4 million Moturoa Island, hideaway in the Bay of Islands’.
Colin Giltrap the automotive millionaire is noted to have recently,
paid $5.5 million for a ninth-floor penthouse apartment overlooking Mt Maunganui beach, reportedly for use as a weekend retreat. The sale price for the four-bedroom rooftop suite at the Eleven development was a record for a Bay of Plenty home, easily eclipsing the previous record of $3.2 million paid in 2004. With views of the main Mount beach, the apartment has two lounges, four bathrooms, a rooftop infinity swimming pool, home cinema and parking in the basement for eight vehicles
Richard Bradley (#52) owns ‘a $30 million mansion in Coatesville, said to be the most expensive residential house in New Zealand’. Gary Lane brought a parcel of 11 Auckland properties from the Sultan in 2005 for $35 million – one of which was a $11 million property in Argyle St, Herne Bay. David Muller lives in a $10.5m house on Paritai Drive in Auckland. Lionel Rogers lives in ‘marble-clad Parnell home (built at a cost of $20 million)’. And of course, John Key ‘continues to own the family mansion in Parnell, holiday homes in Rodney and Hawaii, apartments in London and Wellington and an office in his Helensville electorate’.
One Rich Lister, Neville Crichton, makes his money from the ostentatious expenditure of New Zealand’s elite. Through his ownership of the Ateco Group, Crichton sells ‘brands such as Ferrari, Fiat Maserati, Citroen and Alfa Romeo’. Apparently ‘sales slumped 36% last year to just 104 cars’, and Crichton cites ‘the backlash against conspicuous consumption’ for his decline. However, he now reckons ‘the prestige market’ is recovering and the backlash is over.
The Composition of the Rich List
If you ever have the suspicion that the New Zealand Government tends to give out its knighthoods, ‘damehoods’ and other honorifics essentially only to those from the Establishment, then reading through the 2010 Rich List will reinforce such a belief. Many of the List have such titles:
Sir Douglas Myer (#7), Sir Michael Fay (#8), Sir Peter Jackson (#11; newly knighted), Sir Stephen Tindall (#17; newly knighted), Sir David Levene (#24; newly knighted), Sir Robert Jones (#26), Sir Douglas Graeme (#29), Sir Ron Brierley (#34), Sir George Fistonich (#37; newly knighted), Sir Selwyn Cushing (#40), Sir Patrick Hogan (#40), Sir Eion Edgar (#41), Sir Peter Maire (#48), Sir Clifford Skeggs (#48), and Sir Tim Wallis (#48).
Others with such archaic titulars include Michael Horton, who ‘was made a companion of the New Zealand Order of Merit’ this year. He joins other such Rich List ‘companions’ such as Christopher Mace. Tony Timpson was made an officer of the New Zealand Order of Merit this year too.
The lack of women on the list is a cause for concern to the feminist NBR, which the Rich List editor, Ellen Read claiming that ‘It's really depressing’. The three women are: Lynette Erceg (#4), Jan Cameron (#16; pictured on the right) and Wendy Pye (#46). There are actually other women on the Rich List, but they’re part of the 39 families and 8 couples instead of singularly.
In terms of ethnicity, it’s too difficult to categorise the composition of the list. But it’s certainly not easy to see any Maori present.
Politics on the Rich List
New Zealand is not a plutocracy - the rich do not actually run the country directly (despite the conspiracy theories of many on the left). We may live in an advanced capitalist liberal democracy where the interests of business have an extraordinary influence on public policy, yet to a large extent the areas of politics and wealth are not the same thing in New Zealand and this can be seen by looking at the Rich List, in which there are few politicians or even people overtly connected to parliamentary politics.
The most obvious political person on the list is the Prime Minister. John Key (#50) is up $5m in wealth to a new net worth of $55m in 2010. Apparently His fortune was ‘boosted by his business interests in an Aspen, Colorado ski resort, and shares in Bank of America and the mining company Cauldron’. In a recent Independent newspaper list, he was also ranked the world's 18th most wealthy leader.
National Party president Peter Goodfellow is high on the list, as the Goodfellow family are worth $490m. Not only is Goodfellow busy running New Zealand’s ruling political party, but ‘with brother Bruce, has carried on with the overseeing of the family’s extensive business interests’. Apparently he has ‘a background with the party stretching back 30 years that included serving on the political party’s board since 2006’.
The National Party is linked with a number of other Rich Listers. Philip Carter (#33), brother of National Cabinet minister David Carter makes money from property, having acquired the Carter Group empire that their father established, and is valued as being worth $155m. Ex-Cabinet minister Philip Burdon is ranked at 46, and is one of the largest mushroom producers in Australasia. Apparently he ‘started his fungal business in Cyprus in the 1960s’. And the Foreman family (Bill and Dianne - pictured on the right - who are apparently separated) are seen as being close connected to National through the Business Roundtable and their connection with Don Brash.
The Labour Party doesn’t appear to have any overt links with the Rich Listers, although the Gallagher family that spawned former Labour MP Martin Gallagher are ranked at #32.
Various known donors to political parties show up here and there – Trevor Farmer (Act), Craig Heatley (Act), the Vela family (NZ First), and Doug Myers (Act).
Also related to politics, it’s interesting to read that business consultant David Teece (#29) – who apparently is ‘One of the most renowned business academics New Zealand has ever produced’ – has pointed out that his own ‘mentor Professor Oliver Williamson, who has recently been awarded the Nobel Prize for economics’ was ‘one of the secret architects of New Zealand’s economic reforms of the 1980s’.
The globalisation of New Zealand’s rich elite
The methodology of the NBR’s Rich List has evolved over the years but is still highly problematic. For a start, what is the criteria for being considered for the list? Do you have to be resident in New Zealand? A huge proportion of the 2010 Rich Listers no longer live here. This is especially the case with the richest on the list. For example, at #3 on the list is ‘Irishman’ Eamon Cleary (pictured on the right), who ‘established his fortune in New Zealand through buying cheap farmland during the 1990s recession and converting it to highly profitable dairy operations’ but whose ‘visits to New Zealand are now few and far between’. Christopher Chandler is ranked #5 on the list due to his $1.4b wealth, but he is based on Dubai. His brother, Richard Chandler is next on the list and is based on Singapore. The Goodman family are next on the list but mostly seem to live in Sydney, with much of their business activity in Germany. Stephen Jennings is #7 on the list but lives and makes his money in Moscow. At #8 is Doug Myers who lives in London and has and has ‘no active business interests in New Zealand’. Next on the List, Michael Fay and David Richwhite are also expatriates. Jan Cameron (#16) lives in Tasmania and most of her business empire is in Australia. Colin Giltrap (#19) the automotive millionaire spends much of his time in London (where he is ‘the fourth richest car dealer in the UK’). Gary Lane (#28) is ‘London-based’, Steve Outtrim (#38) lives in Sydney, Tim Williams (#38) lives in Tokyo, Brian Peace (#45) lives in Seychelles, Wendy Pye (#46) lives in the US, David Gaze (#49) lives in the UK, Guy Haddleton and Sue Strother (#49) are based in San Francisco, Richard Bradley (#52; originally of the UK) now lives in Australia, and Ron Brierley (#34) lives in the UK.
All of this indicates the globalised nature of wealth. Is there really such a simple thing as the ‘New Zealand Rich’? Julian Robertson – who last year was made an Honorary Knight Companion of the New Zealand Order of Merit – is estimated by Forbes to be worth US$2.2b, but is not included on the NBR list, despite living here (but having US citizenship). Clearly the rich of the world are now truly global, and the ‘New Zealand rich’ make their money all over the world, and spend it all over the world. Not surprisingly, many of the NZ Rich Listers appear on other countries’ rich lists – for example, Alan Gibbs (pictured on the right) was named the 369th wealthiest in Britain on the Sunday Times Rich List.
Low social mobility
Those that defend the status quo of vast inequality under capitalism sometimes struggle to justify the truly staggering economic inequality that exists. Thus they resort to an argument that ‘economic inequality doesn’t matter because anyone can become wealthy in New Zealand’. They say that it’s OK to have an elite because ‘anyone can become part of the elite, and the elite is always changing’. Traditional elite theorists called this the circulation of elites. Modern elitists refer to the supposed existence of ‘social mobility’ as the justification for economic disparity. Yet it is perhaps indicative of New Zealand’s low social mobility that the NBR Rich List changes so little from year to year, and for 2010 the list has hardly changed at all. As the NBR itself says, ‘the Rich List has remained remarkably stable despite the lingering recession’. This lack of wealth-fluidity shows that there is no real ‘circulation of elites’ as the defenders of elitism often maintain. This just isn’t the case in New Zealand at all. While some change definitely does occur, it is remarkable how much family wealth is present in the NBR list, and this wealth is generational – it shifts down the family tree. In terms of ‘old money’ in the current Rich List, the established family wealth that gets passed from generation to generation is epitomized by the likes of the Myers, Todds, Fays, Richwhites and Spencers who continue to take high places on the Rich List.
This stability – or, ‘low social mobility’ – is seen in the fact that the top 10 Rich Listers and ‘the sectors they operate in remain the same as last year’. In fact for the last nine years in a row the top place on the Rich List has been taken by the same person – Graeme Hart (pictured below).
The new technology nouvelle riche
To the extent that the composition of the economic elite does change over time in New Zealand, the 2010 Rich List points to one interesting shift – the increasing wealth of those that sell ‘intangibles’. The NBR explains:
It used to be dependent on finding something tangible – gold say, or diamonds – but now serious wealth is often generated via intellectual property and ideas. New Zealand is now an environment where an entrepreneur can sell a website for $700 million – an idea not backed up by any assets, just intellectual property
The obvious examples, according to the NBR, are:
filmmaker Sir Peter Jackson ($500m), entrepreneur Sam Morgan ($290m) business academic and one of the world’s top 50 business intellectuals, Dr David Teece ($180m), dot-com pioneer Steve Outtrim ($110m), film industry operators Nigel and Susan Standford ($95m) and publisher Wendy Pye ($70m)
The ‘old’ industries are slowly losing their dominance, the NBR says, and manufactured products and property are perhaps in decline. Certainly the NBR is heralding this ‘movement in wealth towards creativity and intellectual property’. Yet if you examine the Rich List wealth by industry, it can be seen that the two top sectors are ‘Investment’ ($19.2b 32 entries) and ‘Property’ ($8.8b 35 entries). They’re followed by ‘Finance’ ($2.7b 6 entries). Nonetheless it’s true that the ‘Technology’ sector ($1.7b 18 entries) now surpasses ‘Manufacturing’ $1.6b 13 entries, but is just behind ‘Agribusiness’ (1.8b 13 entries). However, the ‘science’ of all these categories are far from methodologically convincing.
Who is generating the wealth?
A few years ago, in response to all the ‘wealth creation’ celebration formented by the NBR, John Minto published a very good opinion piece in The Press. Minto asked: 'So do the rich work harder than the poor? Setting aside the fact that many of the wealthy don't work at all, the answer is still no.' He then succinctly detailed just how wealth is created in economies like New Zealand's and thereby refuted the myth that businesspeople are responsible for making their fortunes:
No-one becomes a millionaire by their own work. They get there by employing people to work for them and by paying them less than the value of the work these employees do. The extra value accrues to the "self-made'' wealth of the individual. The more people employed, the greater the wealth. The role of employers is not a social role to benefit the community but an economic role to benefit shareholders. As soon as difficulties emerge the workers are laid off, have their hours reduced or are tossed aside for a contractor to pick up on lower terms and conditions. Employees are just another resource to be used.
Finally, Minto made the crucial point that 'everything we see in our houses, streets and cities was made by workers. None of it was made by shareholders, entrepreneurs or the non-working wealthy.' Minto's suggested remedy was that we let our unease about the current 'obscenity' turn to anger and change this situation. I couldn't agree more.
A Boring elite
If the intention of the NBR’s Rich List is to excite us about the rich in New Zealand, then in 2010 the exercise fails miserably. After reading through the long publication one can’t help but be rather bored and feel that the elite in New Zealand are rather bland and undynamic. You yearn to read more about the more fascinating entrepreneurs such as Bob Jones, who has one of the more interesting entries. Sam Morgan is another exception – he made headlines earlier in the year with his claim that ‘I pay basically no tax’. Likewise, Hugh Fletcher of the Fletcher family (worth $65m) continues to be busy and a bit more colourful:
Hugh, remains a fixture of New Zealand governance in the private and public sectors, with directorships of, Fletcher Building, Rubicon, Vector and Insurance Australia Group – Australia’s fourth largest insurance company by market capitalisation, in which he increased his stake this year. Mr Fletcher is the deputy chairman of the Reserve Bank of New Zealand, chairman of IAG New Zealand, the chancellor of the University of Auckland and is also on the advisory board of technology venture capital fund No 8 Ventures Management…. Significant investment in racing interests is the thread that this year linked Mr Fletcher and his wife, Chief Justice Dame Sian Elias, to embattled Supreme Court judge Justice Bill Wilson – through previous involvement in horse racing syndicates.
He’s also related to politician Christine Fletcher through her (now dissolved) marriage to brother Angus Fletcher.
David Gaze (#49; pictured on the right) is involved in some of the more interesting business projects of the Rich Listers:
The Gazes are exploring property opportunities in the former Yugoslavia and Malta but also operate the South Pacific Property Fund that promises a 15% annual return on investments in New Zealand. With their sights set on war-torn bargains, the couple are presently looking at clearing land mines from areas in Bosnia and Croatia to repurpose that land. Civil war riven Sri Lanka is also on Gaze’s radar, where a mass exodus of tourists have left behind a large amount of properties in neglect located in beautiful areas. In the UK, Mr Gaze is looking into student accommodation as well, with the modular Mi-Pod concept that parents can purchase for their children, or investors can rent out at healthy returns. Sustainability and social responsibility seem to feature large on the Gaze agenda along with organic salad dressings, marinades, drinks and groceries, as well as patisseries.
The rest of the Rich Listers appear as ‘stick-in-the-muds’. Most of the list are obviously either hedonistic players or publicity-avoiding bores. Even the richest on the list, Graeme Hart, is remarkably boring. One of his main non-business activities in the last year was taking part in ‘a 15-member Kings College parent committee that looked at ways of avoiding a police crackdown on booze-fuelled after-ball parties’!.
Hopefully the boring and un-dynamic nature of the New Zealand elite is becoming clear to most New Zealanders. Certainly there’s a sign that New Zealanders are regaining some of their ‘tall poppy syndrome’ towards the mega-wealthy. For instance, investors like Eric Watson (#23) are widely hated. The NBR notes that ‘his reputation in this country may be tarnished forever’. Hopefully a few more Rich Listers will soon join that category.
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The NBR Rich List at a glance
Rank |
Name |
Value |
1 |
Hart Graeme |
$5.5bn |
2 |
Todd family |
$2.7bn |
3 |
Cleary, Eamon |
$2bn |
4 |
Erceg Lynette |
$1.5bn |
5= |
Chandler Christopher |
$1.4bn |
5= |
Chandler Richard |
$1.4bn |
6 |
Goodman family |
$850m |
7= |
Jennings Stephen |
$800m |
7= |
Myers Sir Douglas |
$800m |
8= |
Fay Sir Michael |
$750m |
8= |
Richwhite David |
$750m |
9= |
Friedlander Michael |
$700m |
9= |
Spencer family |
$700m |
10 |
Cooper Peter |
$650m |
11 |
Jackson Sir Peter |
$500m |
12 |
Goodfellow family |
$490m |
13 |
Gibbs Alan |
$420m |
14 |
Norman Anne & David |
$400m |
15 |
Farmer Trevor |
$380m |
16 |
Cameron Janet |
$350m |
17 |
Tindall Stephen |
$318m |
18 |
Gough family |
$310m |
19= |
Giltrap Colin |
$300m |
19= |
Morgan Sam |
$300m |
20= |
Masfen Peter |
$290m |
20= |
Talley family |
$290m |
21 |
Copson John |
$265m |
22 |
Stewart family |
$260m |
23 |
Watson Eric |
$250m |
24 |
Levene Sir David |
$245m |
25 |
Burr Adrian |
$240m |
26= |
Drinkrow family |
$220m |
26= |
Green Hugh |
$220m |
26= |
Jones Sir Robert |
$220m |
27= |
Cook Cliff |
$205m |
27= |
Duke Rod |
$205m |
28= |
Heatley Craig |
$200m |
28= |
Horton Family |
$200m |
28= |
Lane Gary |
$200m |
28= |
Simunovich family |
$200m |
28= |
Wyborn Mark |
$200m |
29= |
Douglas Sir Graeme |
$180m |
29= |
Kerr George |
$180m |
29= |
Mace Christopher |
$180m |
29= |
Manson Edward |
$180m |
29= |
Pye Alan |
$180m |
29= |
Richardson family |
$180m |
29= |
Teece David |
$180m |
29= |
Vela family |
$180m |
30 |
Hill Michael |
$170m |
31 |
Foreman family |
$165m |
32= |
Crichton Neville |
$160m |
32= |
Gallagher family |
$160m |
33 |
Carter Philip |
$155m |
34= |
Bayley family |
$150m |
34= |
Brierley Sir Ron |
$150m |
34= |
Stevenson family |
$150m |
35 |
Giesen family |
$130m |
36= |
Bagnall Andrew |
$120m |
36= |
Hopper family |
$120m |
36= |
Huljich family |
$120m |
36= |
Plested Bruce |
$120m |
36= |
Reid Michael |
$120m |
36= |
Robinson family |
$120m |
37= |
Delegat Jim & Rosemari |
$115m |
37= |
Fistonich George |
$115m |
38= |
Barfoot family |
$110m |
38= |
Hickman Kevin |
$110m |
38= |
Outtrim Steve |
$110m |
38= |
Thompson family |
$110m |
38= |
Williams Tim |
$110m |
39 |
Colman Barry |
$105m |
40= |
Cushing Sir Selwyn |
$100m |
40= |
Hogan Sir Patrick |
$100m |
40= |
Lowe family |
$100m |
40= |
Wallace James |
$100m |
41= |
Abbott Richard |
$95m |
Rank |
Name |
Value |
41= |
Caughey family |
$95m |
41= |
Edgar Eion |
$95m |
41= |
Harvey family |
$95m |
41= |
McCaw Phil |
$95m |
41= |
Muller David |
$95m |
41= |
Stanford Nigel and Susan |
$95m |
42= |
Kirkpatrick James |
$90m |
42= |
McLaren Don |
$90m |
42= |
Wood Nic and Tim |
$90m |
43= |
Adams Paul |
$85m |
43= |
Anderson Ron |
$85m |
43= |
Foster Robert |
$85m |
43= |
Morrison Lloyd |
$85m |
43= |
Titchener family |
$85m |
43= |
Turner family |
$85m |
44= |
Inger Glen |
$80m |
44= |
Jarvis Terry |
$80m |
45= |
Glasson Tim |
$75m |
45= |
Marris Brent |
$75m |
45= |
Paykel family |
$75m |
45= |
Peace Brian |
$75m |
45= |
Perry family |
$75m |
45= |
Richter Mark |
$75m |
45= |
Ryder John |
$75m |
45= |
Sax John |
$75m |
45= |
Thomas Barry |
$75m |
45= |
Yealands Peter |
$75m |
46= |
Bullivant Vaughan |
$70m |
46= |
Burdon Philip |
$70m |
46= |
Coon Chris & Richard |
$70m |
46= |
Higgins family |
$70m |
46= |
Hoggard Kerry |
$70m |
46= |
Holyoake Noel |
$70m |
46= |
Hynds family |
$70m |
46= |
Nightingale family |
$70m |
46= |
Pye Wendy |
$70m |
46= |
Rogers Lionel |
$70m |
46= |
Savage Roy |
$70m |
46= |
Smith Julian and Nick |
$70m |
46= |
Van Den Brink family |
$70m |
47 |
Timpson Tony |
$66m |
48= |
Alpe Chris |
$65m |
48= |
Babich family |
$65m |
48= |
Baker Grant |
$65m |
48= |
Davies John |
$65m |
48= |
Fletcher family |
$65m |
48= |
Izard Richard |
$65m |
48= |
Maire Peter |
$65m |
48= |
McVicar family |
$65m |
48= |
Singleton Lester |
$65m |
48= |
Skeggs family |
$65m |
48= |
Walkington Nigel and Rosemary |
$65m |
48= |
Wallis Sir Tim |
$65m |
49= |
Bedogni John |
$60m |
49= |
Gaze David |
$60m |
49= |
Gregory Cameron |
$60m |
49= |
Haddleton Guy and Strother Sue |
$60m each |
49= |
Henry Simon |
$60m |
49= |
Smith Andrew |
$60m |
49= |
Ullrich Gilbert |
$60m |
50= |
Avery Graeme |
$55m |
50= |
Balcombe-Langridge Richard |
$55m |
50= |
Butterfield John |
$55m |
50= |
Jordan Neville |
$55m |
50= |
Key John |
$55m |
51 |
McConnon family |
$52m |
52= |
Armstrong Shane |
$50m |
52= |
Bradley Richard |
$50m |
52= |
Drury Rod |
$50m |
52= |
Gibbons family |
$50m |
52= |
Jeffery Alistair |
$50m |
52= |
Millar Ken |
$50m |
52= |
Rolleston Humphry |
$50m |