Rinehart sheds 86.5 million Fairfax shares. Why?

I was leaving the office of Fairfax Radio CEO, Adam Lang, when the news was broadcast on 2UE about Gina Rinehart’s private company, Hancock Prospecting, having sold 3.7 per cent of the Fairfax shares it bought just days ago to bring her holding back down below 15 per cent. One of the questions I had asked Lang in a lengthy interview, was how does it affect morale when the company’s largest shareholder describes its radio network as “peripheral?” We’ll have that interview for you on radioinfo early next week.

But why sell so soon?

According to the statement from Hancock Prospecting, “The sale was completed to resolve an issue that arose concerning the Directors and Officers Insurance Policy, in the situation of a Director having a greater than 15% shareholding in Fairfax.”

The statement went on to concede that “This was one of the key issues recently raised by the Chairman of Fairfax and needed to be resolved.”

But then, the statement couldn’t help but take another swipe at Fairfax Chairman, Roger Corbett, (pictured) suggesting that he could have resolved the matter, if he chose to, “by authorising endeavours to raise the 15% limit, which has been able to be reasonably achieved by other companies.”

Is Mrs Rinehart selling out? No says the Hancock statement, “We also deny unsubstantiated rumours spread by others, that we are about to “make an offer” for the Company, when we have previously stated we are not seeking control of Fairfax, just the appointment of 2 directors plus an independent out of up to 12 directors on the board.” 

Peter Saxon