Harbinger Capital Partners has made good on its threat to try to place directors of its own choosing on the board at Media General (1/21/08 TVBR #13). The hedge fund has formally filed to nominate Eugene I. Davis, F. Jack Liebau Jr. and J. Daniel Sullivan to stand for election at the annual shareholders meeting set for April 24th – presumably opposing candidates nominated by company management. The New York Times Company also announced that it has received word from Harbinger that it plans to nominate four candidates for that board.
Of the Harbinger nominees at Media General, Dan Sullivan is familiar to TVBR readers. He was CEO of Sullivan Broadcasting, before it was acquired by Sinclair in 1998. Davis and Liebau are both money managers. Until recently, Davis was a director of Ion Media Networks.
Media General CEO Marshall Morton immediately fired off a letter to employees assuring them that “Harbinger cannot, under any circumstances, gain control of Media General.” He also issued a press release charging that Harbinger seemed to be unaware of the actions that management has been taking to reduce costs and sell non-core assets. Morton said Media General management had made repeated attempts to contact Harbinger, but that the hedge fund managers “persistently refused to return our calls.”
Less is known of Harbinger’s intentions regard the New York Times Company. The hedge fund has not made any sort of recent filing with the SEC regarding any stake it holds there and no board nominees have been publicly identified. Chairman Arthur Sulzberger Jr. issued a statement that the company would “review the nominations and make a recommendation to our shareholders in due course.”
TVBR observation: Harbinger cannot be anything more than an irritant on the board in either company, since both have two-tiered voting structures that guarantee voting control for the founding family. That is the Bryan family at Media General and the Ochs-Sulzberger family at the New York Times Company.