A 2-month-old destabilizing fight came to an end May 30 with the appointment of the Seven Network’s 18.9% rebel shareholder Kerry Stokes and his associate, Golden West Network chief executive Bill Rayner, to Seven’s board of directors, effective June 1.
In exchange for gaining the two seats he has lobbied so vigorously to achieve, Stokes’ company Ashblue has withdrawn its requisition for a July 10 general meeting at which Stokes was to have a potentially embarrassing public showdown with directors.
Also, Stokes has dropped his claim for the chairmanship of the web in favor of Ian Holmes, who was appointed two weeks ago after the departure of Ivan Deveson, caused largely by Stokes.
The deal, hurriedly cobbled together last weekend, marks an abrupt about-face for the web, which had steadfastly maintained Stokes could only have one seat. Some believe the relentless public criticism of the web’s advertising, revenue and ratings performance by Stokes, plus its pay TV deal with Optus Vision, prompted the compromise.
Confirming widespread speculation, a source in the Stokes camp claimed the web had “counted the numbers and realized they would get rolled at the meeting, and media pressure played a part.”
A Seven insider scoffed at such suggestions, but explained the sudden backdown as “wanting a resolution and ending the destabilization; if a deal was to be done, time was running out.”
A ninth director is to be appointed to the board, offsetting the extra Stokes lieutenant to keep the board independent. The new board will have one director each for shareholders News Corp. and Telstra, two for Stokes and five directors independent of large shareholders.
“I am very pleased that Kerry Stokes and Bill Rayner have agreed to join the board and withdraw the… requisition. We will now have the opportunity to work together and achieve growth in the company’s profitability and improve its overall performance,” Holmes said.
“Bill and I are very keen to bring our experience and expertise in broadcasting to the development of a strategic direction for the Seven Network,” Stokes added.
And no wonder. Stokes’ Seven buying binge has cost him $A180 million ($129.9 million).