The power of Australia's richest woman, Gina Rinehart, was immediately felt by Fairfax Media even before she steps into the company's boardroom. A day after Ms Rinehart threatened to sell her shares of the company, Fairfax shares declined 3.5 per cent and closed at 55 cents.
David Gray / Reuters
Australian media company bosses (L-R) David Kirk, Chief Executive Officer (CEO) of Fairfax Media, Michael Anderson, CEO and Chairman of Commercial Radio Australia, John Hartigan, Chairman and CEO of News Limited, Mark Scott, Managing Director of the Australian Broadcasting Corporation (ABC) and Julie Flynn, CEO of Free TV Australia sit together during a news conference in Sydney May 10, 2007 to announce their coalition to fight against the erosion of press freedom in Australia. The coalition will lobby federal and state governments to ease some of the 500 separate prohibitions which they say deny the Australian public access to important information. REUTERS/David Gray (AUSTRALIA)
The dip was attributed to her threat which made other Fairfax stakeholders unload their stocks ahead of an anticipated boardroom battle when Ms Rinehart gets her demand and given more powers by the board of directors.
Due to the continuous share price decline, which even reached a record-low of 53.5 cents before it ended at 55 cents, Fairfax's market capitalisation plummeted to less than $1.3 billion from $7.5 billion in 2008.
Among the demands of Ms Rinehart, who is also the world's richest woman, are three director seats, being named deputy chair and the power to hire and fire editors.
Wary of a Rinehart rule, The Age Editor-in-Chief Paul Ramadge resigned on Monday. Appointed as Ramadge's replacement is Andrew Holden, the former editor of The Press in New Zealand which Fairfax also owns. Named as The Age news director is Steve Foley, ex-editor of The Sunday Age.
The fear of a rule by the mining magnate has led to a so-called Ginaphobia which has extended to legislators.
On Tuesday, Labor whip Joel Fitzgibbon spoke against Ms Rinehart's attempt to wield media power against the party and destroy the editorial independence at Fairfax.
"I'm increasingly concerned that her key objective is to use Fairfax as a tool in her fight with the government.... Given she's refusing to sign the charter, it's hard to come to any conclusion other than that her attempt to control Fairfax is about tearing down a government that is pursuing policies she disagrees with," The Australian quoted the MP.
Victorian MP Steve Gibbons did not hide that his intention in seeking a tougher media overseer was the manner Ms Rinehart is pushing her weight around at Fairfax.
An unauthorised biography of Ms Rinehart by Fairfax journalist Adele Ferguson, released Tuesday, provides an insight as to why the billionaire is an expert in wielding power.
Ms Ferguson said that the young Gina was a product of her father's political views since at an early age and as an only child, he had trained her to be his understudy.
"He would pull her out of school when she was 12, take her around the world to meet the likes of Margaret Thatcher, the president of Singapore... and introduced her to many, many colorful figures such as Edward Teller who was the father of the hydrogen bond," Ms Ferguson explained to ABC.
Ms Ferguson said the billionaire did not hide her desire to exert editorial influence at Fairfax. The Fairfax board is wary of what she would do if appointed director, including the possible filing of lawsuits against members of the board for poor management of the company.
"She has a determination that was inherited. It's in her DNA, that she inherited from Lang Hancock. And the other is her second husband, Frank Rinehart, was a US attorney law who knew the law very well and people who know her say that he really influenced her litigation to say it's a really powerful tool to get what you want."
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