SYDNEY (Reuters) - Australian mining billionaire Gina Rinehart, the country’s richest person, said she has sold her stake of nearly 15 percent in newspaper publisher Fairfax Media Ltd, citing “a series of bad decisions made by the leadership team”.
Rinehart, Fairfax’s biggest shareholder, sold her entire 14.99 percent stake in the A$2.2 billion ($1.7 billion) company to Morgan Stanley for A$352 million in after-hours trading on Friday, a source close to Rinehart told Reuters.
Morgan Stanley was then trying to re-sell the shares late on Friday. The investment bank did not return calls requesting comment.
In a statement, John Klepec, chief development officer of Rinehart’s privately-held Hancock Prospecting, said the company sold out because “the senior leadership of Fairfax Media has no workable plan to revitalise the company and address the declining business and circulation numbers”.
“A series of bad decisions made by the leadership team has instead increased the number of publication errors and reduced the company’s performance to cover news to standards expected to maintain the credibility of some of the oldest and finest newspaper mastheads in the country,” Klepec said.
Fairfax publishes some of Australia’s best-selling newspapers, including The Sydney Morning Herald, The Age and The Australian Financial Review.
Klepec added that if the Fairfax leadership changes, “we may consider a future role in the company”.
Rinehart sold her shares at A$0.87, compared to the stock’s closing price of A$0.96, the source said.
A Fairfax spokesman did not immediately comment on Klepec’s statement. He earlier declined to comment on the sale but said “we expect Mrs Rinehart’s investment in Fairfax has been one of her better media investments”, a reference to her stake in struggling television broadcaster Ten Network Holdings Ltd.
Rinehart, who inherited iron ore mines in resources-rich Western Australia state and then rode the commodities boom to briefly become the world’s richest woman, has been Fairfax’s top shareholder since staging a share raid in 2012.
That purchase stoked speculation Rinehart was considering a full takeover of the company although no bid was ever reported.
The stake sale comes after a halving of iron ore prices since mid-2014 that has forced many Australian mining firms to dramatically rein in spending.
Fairfax shares ended at their highest close since June 10 2014, in line with a 12th day of gains on the broad market.
Editing by Alan Raybould and Muralikumar Anantharaman