ANYONE who has followed the decline of Fairfax Media over the past few years will have been waiting for the day when the slow, inexorable decline goes into free fall. That moment may today be closer, with the stock at one point this morning descending to 69.5 cents, just a cent-and-a-half above its all-time low. As of 2.30pm it had clawed its way back to 70.5 cents, which still left it down almost 3% on the day so far. What makes this interesting is the volume, with some 20.5 million shares changing hands. That is roughly twice the average daily tally and it suggests AFX is being dumped.
What happens when the stock drops through that 69 cent barrier? Only time will tell, but one strong possibility will be that Gina Reinhart’s bid for one or two board seats is going to get a rocket-powered boost. How can Greg Hywood & Co look their largest stockholder in the eye and tell her to get lost, especially when their own tenure has seen a downhill run all the way?
The luvvie left imagines Reinhart wishes to call the editorial shots -- no doubt an example of projection, as that is what it does when given half a chance. But perhaps Reinhart sees things with a greater clarity, realising that it is the nonsense Fairfax publishes which has done so much to limit its market, sales and stock price. Fix the product and she might just turn the business side around.
Readers sometimes write to the Billabong to ask after the Professor’s peculiar interest in Fairfax. The answer is simple, and it is two words: Rupert Murdoch.
Several months ago, News Limited made Glen Milne disappear. Phhhtt! and he was gone – and all because, or so it would seem, those who run the company perceived it a better policy to avoid further aggravating our for-the-moment Prime Minister and her rabble. Murdoch, of whom many good things can be said, insisted in London last night that he neither bows to nor intimidates politicians, but Milne’s banishment puts the lie to his words. So, too, does the Herald & Weekly Times’ shameful decision not to appeal Andrew Bolt’s conviction for hurting the feelings of a few sensitive and well-connected souls.
A second media organisation, even an imperfect one, would go some way toward to boosting the cause of freedom of speech. That is why a healthier Fairfax is worth the effort of desiring.
UPDATE: Daily volume is now at 26 million and the stock has dropped again, down to 70 cents.
Gina, start making a fuss. Given that you bought into Fairfax at 81 cents, these jokers have already cost you around $20 million.
UPDATE II: Bad numbers all over.