Fairfax Stock at Record Low as Rinehart Denied Seat on the Board
Fairfax Media Ltd., Australia’s second-largest newspaper publisher, headed for a record low in Sydney trading after the company said it couldn’t offer its biggest shareholder Gina Rinehart a board seat.
The billionaire mining magnate, who owns 19 percent of Fairfax through her closely held Hancock Prospecting Pty. Ltd., has said she may sell her stake unless given directorships. The stock fell 2.7 percent to 54 Australian cents at 10:32 a.m., headed for its lowest close since the company was listed in 1992. The benchmark S&P/ASX 200 Index gained 0.7 percent.
Chairman Roger Corbett said in an e-mailed statement after market close yesterday the board couldn’t offer Rinehart a seat after failing to reach an agreement on editorial independence. Rinehart was seeking directorships without any conditions, such as agreeing to sign the company’s so-called Charter of Editorial Independence.
The mining magnate, Asia’s richest woman with an $18.5 billion fortune according to the Bloomberg Billionaires Index, is pushing the company to address a slumping share price, declining newspaper circulation and record losses.
“The company has received tens of thousands of e-mails and other correspondence from shareholders, our readers and others making it clear that they support Fairfax’s long-standing position on editorial independence,” Corbett said in the statement. Fairfax announced last week it’s cutting 22 percent of its workforce in a bid to halt sliding revenue and earnings.
Mark Bickerton, a spokesman at Hancock Prospecting, didn’t immediately reply to an e-mailed request for comment.
News Corp., the media company controlled by Rupert Murdoch, is Australia’s largest newspaper publisher.