Last Friday Sandon Capital, the Australian-based activist investment firm who buy shares in companies they perceive as undervalued and underperforming companies to influence their boards to take action, executed notices under section 203D of the Corporations Act to Southern Cross Media Group Limited (SCA) seeking to remove non-executive directors Heith Mackay-Cruise, Ido Leffler, Carole Campbell and Marina Go at the next general meeting.

Today, May 12, in an ASX release, SCA responded saying that the majority of the share register are supportive of the current Board and management and intend to vote against such resolutions noting that no notice was provided that a general meeting be called.

In a series of ASX announcements last week, SCA announced a trading and dividend update, a new buyer for TV assets and an Executive Incentive Scheme (EIS), only for senior executives of SCA, with the aim of aligning the objectives of investors more closely with the incentives for the executive team. It would appear that the latter was the issue for Sandon according to The Australian (subscription required) with the company’s founder and managing director Gabriel Radzyminski (pictured) writing to Heith Mackay-Cruise to say he was “stunned” that SCA’s directors decided to resume the payment of dividends in light of a trading update.

SCA noted in their response the TV station sale and that audio revenue had grown more than anticipated with non-revenue relayed costs for continued operations also ahead of previous guidance. They also said that, with Sandon only acquiring its interest in October 2024 at just $0.51 per share, the share price at the close of trade on Friday May 9 was $0.71, representing an increase of almost 40%. It is currently $0.75 (see below), 20c more than ARN‘s whose own bid to take over the company fell apart a year ago today.

Jen Seyderhelm is a writer, editor and podcaster for Radioinfo.