Share |

Families assert their strength in the media

The families behind two prominent media companies, Australia-based Fairfax Media Ltd and Independent News and Media of Ireland, have both exerted their control over the direction of the business after company disagreements.
Ron Walker, the non-family chairman of Fairfax Media, announced yesterday he will not stand for re-election after two board members, both of the founding Fairfax family, said they would no longer support his tenure as chairman.
The move comes in spite of Walker receiving the full support of the other members of the Fairfax board. In his statement of resignation he said: "In view of the unfortunate developments of the previous weeks I have come to the view that in the best interests of our 52,000 shareholders and 10,000 employees I should not seek re-election. This will enable a smooth transition to a new chairman, and for the process of board renewal we have already commenced to be continued.
"In addition it will enable our board and management to continue to focus on the tasks ahead of our great company rather than being mired in disputes and controversy with one single shareholder," he concluded.
The Fairfax family owns 9.7% of Fairfax media shares through its private company Marinya Media. John (pictured) and Nicholas Fairfax, both board members, last week called for Walker not to stand for re-election so the company could attempt to rebuild shareholder value that had been "destroyed" during Walker's time as chairman and reunite as a board. (Click here to read our coverage of the story)
Meanwhile, the family that controls Independent News & Media has asserted its influence to prevent rebel shareholder Denis O'Brien from gaining control of more shares in the company by successfully implementing a debt-for-equity swap followed by a rights issue.
The move will see bondholders swap €123 million of bonds for 46% of the company. The rights issue allows shareholders to retain control of their current stake, subject to board approval, which is good news for the O'Reilly family, the company's largest shareholders.
This was not the rescue plan second-largest shareholder O'Brien had in mind when he called for the company to reassess how it was addressing its €1.4 billion of debt. (Click here to read out coverage of the story) The company will keep the UK daily newspaper the Independent, which O'Brien wanted to sell, and has not accepted his offer to inject some of his own capital into the business.
However, the extraordinary general meeting requested by O'Brien to decide the fate of the non-family company chairman will still go ahead on 3 November. (Click here to read our coverage of the story)

Want to get the latest family business/family office news direct to your desktopClick here to register to receive our weekly newsletter

Are you a member of a multigenerational family business or family office? Click here to subscribe to our magazines

Click here >>