Media reports circulating today indicate that by late afternoon Gina Rinehart managed to increased here stake in Fairfax Media, from 4% to 13%. It is almost certain that from now on Ms Rinehart will play more direct and active role in shaping the fortunes of the company. However, most commentators speculate she is not interested in making money on this investment (she actually lost quite a few millions on the first tranche bought last year) – rather, in gaining control of a vehicle to influence public opinion and, ultimately, government policies. It’s quite possibly the reason but why not achieving both, since she is buying into Fairfax at such a low price?
In June last year I wrote a post about Fairfax, highlighting misguided strategies that undermined the company position over the years and commented that “There is some hope that Gina Rinehart will take on a more active role within the company structures, instigate setting the proper strategic direction for Fairfax and reinvigorate the management team to implement the new vision with a greater zeal for success.” Well, if there is going to be a turnaround in Fairfax Media fortune, there is a good chance it will start happening soon. Time will show if Ms Rinehart's Midas touch can extend to other than mining assets.
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