30 Jun 2012

Ultimatum by Rinehard to Fairfax chief

6:53 am on 30 June 2012

Mining billionaire Gina Rinehart has asked the head of Fairfax Media to resign if he cannot reverse falling circulation and revenue at the company's newspapers.

In an open letter to chairman Roger Corbett, Ms Rinehart asked him to step down by November if a number of performance milestones had not been met.

Ms Rinehart is the largest single investor in Fairfax Media with almost 19% of the company's shares.

In her letter to Mr Corbett, Ms Rinehart said the performance of Fairfax Media over the past five years had been distressing for shareholders.

She called for the Fairfax share price to rise from current levels of 55 cents to 87 cents before the annual general meeting in November.

"Shareholders should at the very least be advised what the loss target is, and be assured that should you not meet that target, there would be light at the end of tunnel," the letter said.

"And, if the five-year decline in paid circulation and in revenue of Fairfax mastheads do not reverse prior to the 2012 AGM, we ask that you tender your resignation at that meeting."

Ms Rinehart is seeking seats on the Fairfax board after a large acquisition of shares earlier this month left her with 18.7% of the company. She is the world's richest woman.

This week, Mr Corbett told her that Fairfax was unable to extend an invitation for her to join its board.

Ms Rinehart refuses to sign the company's charter of independence. The ABC reports this has raised concerns she would interfere with the editorial independence of Fairfax newspapers, the Sydney Morning Herald and The Age.

"Where we have differed most profoundly is not over the charter of editorial independence, contrary to much Fairfax reporting, but how to save a business that is reportedly in danger of dying," Ms Rinehart said in the letter.

"What is at stake is the survival of Fairfax Media, so it is not time for smoke screens to divert attention."