The three remaining independent directors from the April proxy fight at West Australian Newspapers have given up the ghost and relented to billionaire Kerry Stokes and his offsider Peter Gammell joining the board. Check out Seven’s announcement here.
Shareholders will get to vote on their appointment at the AGM on November 5 in Perth and it will be very interesting to see whether besieged chairman Peter Mansell can survive, especially given his ridiculous workload and the debacle at OZ Minerals. For now, he seems safe.
Stokes told institutions earlier this year that he wanted to be an interim chairman to shake up WA News and Mansell now looks completely hypocritical given that he fought tooth and nail to resist Stokes joining the board based on what he called a fundamental conflict of interest. There’s now talk about Stokes abiding by “a conflict of interest protocol”.
The residual takeover premium in the sagging WAN share price will quickly disappear now that Stokes is inside the tent. Why both with a full takeover bid at all?
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The WAN board is also looking for one more independent director so the final composition will be two representatives for Seven, three residual independents from the asleep-at-the-wheel days and two new independents, including feisty former Rentokil CEO Doug Flynn, who learnt the trade as one of Rupert Murdoch’s hard men in Australia and the UK.
Well qualified candidates such as Steve Harris should consider nominating at the AGM because the board is seemingly taking forever to find these new directors.
The West Australian’s editor Paul Armstrong might have finally prevailed over his bitter political enemies Alan Carpenter and Jim McGinty with the defeat of the Labor state government, but it will probably be a short-lived victory as Stokes and most independent observers clearly believe he should go.
The fate of Armstrong will be the first big test of whether Stokes is exercising control, because Armstrong ran quite a partisan campaign against the billionaire during this year’s proxy battle.
Then there’s the issue of Seven being more than $100 million under water on its 23% stake in WAN and the stock is down another 23c at $8.52 this morning.
Stokes will want some fast action on things like The West’s lame website, falling circulation and the ongoing disputes with newsagents.