WA: Stokes won't be going anywhere if he loses, says analyst

AAP General News (Australia)
04-22-2008
WA: Stokes won't be going anywhere if he loses, says analyst

By Warwick Stanley

PERTH, April 22 AAP - Should Kerry Stokes lose tomorrow's battle for The West, it's
unlikely the war will be over.

No-one can be sure which camp will prevail at tomorrow's extraordinary meeting of shareholders
in Perth to decide whether the Seven Network owner gains up to two seats on the board
of West Australian Newspapers (WAN).

A 19.4 per cent shareholder in WAN through his Seven interests, Mr Stokes wants seats
on the five-person board for himself and Seven director Peter Gammell.

WAN chairman Peter Mansell wants to stop the boardroom break-in, accusing Mr Stokes
of a grab for control "without a premium being paid to our shareholders".

The war of words between the pair began early last year and escalated in recent months,
culminating in Mr Stokes' call in February for an extraordinary meeting at which shareholders
could vote on whether to keep the existing board.

The stoush may end tomorrow at the Hyatt Regency Hotel in the city centre, just a stone's
throw from the Swan River.

Mr Mansell and three fellow fellow non-executive directors, Jenny Seabrook, Mel Ward
and Erich Fraunchiel, say they are prepared to resign if the pair are elected.

Mr Stokes has said if he is successful in gaining the seats, Seven would increase the
board numbers to seven and vote its key stake for University of Western Australia's senior
deputy vice-chancellor Margaret Seares and Perth engineer and ex-Vodafone chief executive
Peter Abery.

Sydney-based media analyst Mark McDonnell, of BBY Securities, likens the wrangle to
a political election.

"The imponderable is how many people are going to be bothered to vote," Mr McDonnell said today.

"Even after you look at the people with substantial holdings, there are still about
5,000 shareholders with substantial positions, in a relative sense, to the total share
register.

"That's quite a large number of people and it's very difficult to be sure how many
of them feel sympathetic to the criticism that Seven have made, and how many feel a change
is desirable.

"The fact that Andrew Forrest, who is even wealthier than Kerry Stokes, has come out
in favour of a change, might not necessarily translate into votes among those shareholders
who are less wealthy.

"What has has emerged over the last week or so is that there's a clear ticket.

"Prof Sears was at pains to point out she's independent and she's only just met Kerry
Stokes for the first time.

"To complete the election analogy, we've now got the sense that there's a Seven ticket."

Mr McDonnell said even if Mr Stokes fails to gain a seat on the WAN board tomorrow,
his bid is unlikely to end there.

"If the existing board is returned, it's hard to image the Seven board will desist
from its criticism," he said.

"With 19 per cent, they're actually a party that has right every right to be heard.

"You need a lot of parties to successfully vote against that position.

" ... Mr Stokes gives the impression from his public performances he's thoroughly enjoying this.

"As far as Mr Mansell's concerned, it's almost as if (he's saying) `how dare this
man criticise us' ... it's as though directors were meant to be unaccountable to their
shareholders.

"If the existing board board is returned I don't think it's over, not when you consider
how determined Kerry Stokes can be."

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KEYWORD: WAN STOKES

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