Saturday, 6 February 2016
Last updated 1 day ago
Apr 2 2008 | 12:51pm ET
Activist hedge fund Harbinger Capital Partners and target company Media General are no closer to common ground after the two sides aired their differences before an audience of institutional investors.
Media General CEO Marshall Morton criticized Harbinger, telling Reuters the hedge fund’s ideas are “not workable or usable.”
“Harbinger's proxy statement says that it thinks we've ‘lost strategic, operational and geographic focus,’” Morton told forum-goers. “That's a quote—and in making that charge, Harbinger mostly points to acquisitions we made years ago. And, since those acquisitions were years ago, Harbinger simply can't square that statement with the reason it gave for investing in Media General just this past summer.”
Morton added that Harbinger’s nominees to Media General’s board “cannot hold a candle” to the incumbents the hedge fund wants to unseat. He said he would not meet with the hedge fund again; the shareholder meeting is scheduled for later this month.
Harbinger’s Joseph Cleverdon also addressed the meeting, called by Media General investor Mario Gabelli of GAMCO Investors, noting that, like the company itself, the hedge fund wants Media General to pay down its debt. But Harbinger, which laid its position out in detail for the first time at the meeting, called on Media General to consider “alternatives” for its Florida holdings, which include the Tampa Tribune and WFLA, the state’s highest-rated television station. Media General’s Florida properties have taken a beating recently, thanks to declining ad revenue.
Cleverdon also took aim at Media General’s dual share-class structure, which gives the Bryan family control of the company’s board. In its successful bid for representation on The New York Times Co.’s board, Harbinger took pains to say it did not want to change a similar policy in at Richmond, Va.-based Media General.
But despite those fighting words, Cleverdon said Harbinger, which owns 18% of the Media General’s Class A shares, expressed optimism that the two sides could reach accord before the shareholder meeting.